Internet Marketing Tycoon

**jacks smith** · 08-26-2010, 12:09 AM

Hello friends,
I want to know how we calculate ROI.
Thanks

**Jim Gillum** · 08-26-2010, 02:00 AM

How much it cost from how much you made......

Simple calculation....actually more complicated than that but it will give you the gross profit....more to get net profit....

**Jim Gillum** · 08-26-2010, 02:22 AM

Quote:

Originally Posted by victorben

ROI= profit-investment/investment.

Yes ....that is partially right ....
But there is more to determining the actual net profit....

**ThailandForum** · 08-26-2010, 03:35 AM

Generally a business expects to break even in the second year, with the advent of the internet and millions of idiots expecting to make their fortune they may not be happy with the outcome, I should imagine that in googles second year they were frantically seeking venture capital to expand rather than starting to see a return on their investment, so how much is your 10 dollar domain worth today?

**Jim Gillum** · 08-27-2010, 01:12 AM

Amazon lost many for several years.....
What is their ROI?....

**ThailandForum** · 08-27-2010, 01:25 AM

I have spent 5 years building up my main domain, shall probably be happy with it by the end of this year, next one will be a lot easier and I reckon 2 years will be enough

**francis84** · 08-27-2010, 01:38 AM

The formula in getting the ROI is:

ROI = (Gain from Investment - Cost of Investment) / Cost of Investment

But, there are several figures you’ll need for your ROI calculations; like:

Cost of goods sold (COGS)- The cost to physically produce a product or service.
Marketing investment - Typically you’d include just the cost of the media, not production costs or time invested by certain employees; however, in certain cases it may be better to include all of those figures.
Revenue- It can be tricky to tie revenue to a particular campaign, especially when you run a variety of campaigns and have a long sales process. Your finance team may have some suggestions for estimating this figure.

**Jim Gillum** · 08-27-2010, 01:46 AM

When you do the calculation to determine the true net profit...
You must consider ALL the costs to you involved.....

Many times people forget to include the total operating expenses including...
Domain name ...hosting...office expenses etc.

And your time is worth something...often overlooked in computing actual cost....

How much do you "pay" yourself for your time...??