Question

A mini-calculator company saw its sales decrease over the last year and decided to launch a new marketing mix strategy to boost awareness and sales. One of the company’s implemented tactics was to sell its mini-calculators through Amazon. It spent $5,000 to add new colors to their product offerings and $5,000 launching a video ad campaign. After tracking its online sales metrics, it saw a leap in sales of $20,000 in three months. What is this company's ROI on their marketing efforts?

Answer 1

The ROI is 2

Step-by-step explanation:

For computing the ROI we have to apply the formula which is shown below:

= Return in terms of benefit ÷ investment

where,

Return is in terms of sales which equals to $20,000

And, the investment equals to

= New color cost + video launching cost

= $5,000 + $5,000

= $10,000

Now put these values to the above formula

So, the answer would be equal to

= $20,000 ÷ $10,000

= 2