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return on marketing investment (ROMI)

Contributor(s): Guy R. Powell

Return on marketing investment (ROMI) is a metric used to measure the overall effectiveness of a marketing campaign to help marketers make better decisions about allocating future investments. ROMI is usually used in online marketing, though integrated campaigns that span print, broadcast and social media may also rely on it for determining overall success. ROMI is a subset of ROI (return on investment). 

In the simplest sense, ROMI is measured by comparing revenue gains against marketing investment. This calculation, however, reflects only the direct impact of marketing investment on a business's revenue. As a result, many digital marketers include dwell time or brand awareness in their ROMI metrics in an effort to quantify less tangible benefits and target future campaigns more effectively. According to ROMI expert Gary R. Powell, with the right data and analytics, marketers can deliver between 8% - 15% increased revenue, profit and market share to the client without any increase in marketing investment.

Return on marketing opportunity (ROMO) is a similar metric used by digital marketers that focused on the wider influence of a campaign. Both terms are part of a wider attempt in the industry to measure impact-based advertising.

Learn more about IT:
>
 Marketing Evolution.com features a downloadable case study about evaluating the return on marketing objectives (ROMO). (PDF)
> Guy R. Powell explains advertising, branding, ROMI and PR ROI in his book, "Return on Marketing Investment."
 

This was last updated in October 2008

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