Pay per click (PPC) is a method of advertising where a business places an advert on a website and pays an amount of money for each click it receives on the advert. The amount the business pays is called the cost per click.
A certain percentage of the people who click on the advert are then converted to take the action required, the action required is usually to purchase goods or services from the business.
PPC advertising campaigns are increasing in popularity as it is capable of tracking results and costs to provide a demonstrable return on investment. This pay per click ROI calculator will help you to measure marketing roi for any pay per click ad spend.
The return on investment ROI is the profit from the pay per click campaign divided by the total cost of the campaign, and the pay per click roi formula can be stated as follows:
Using the Pay Per Click ROI Calculator
The Excel pay per click ROI calculator, available for download below, shows how to calculate pay per click roi by entering details relating to the pay per click ad spend campaign as follows.
- The total cost of the pay per click ad spend campaign is entered. This is the total budget the business is prepared to allocate to the campaign.
- The cost per click is entered. This is the cost the business is prepared to pay per click. The pay per click ROI calculator calculates the expected number of clicks the budget will pay for.
- The conversion rate is entered. The conversion rate is the percentage of clicks which are expected to convert and take the action required. The action required is typically, for example, to make a purchase from the business. The pay per click ROI calculator calculates the expected number of conversions and the pay per click campaign cost per conversion.
- The expected income from each conversion is entered. This is the income the business anticipates from the required action being carried out. For example, if the required action is to make a purchase from the business, the income from each conversion is the gross profit from that purchase. The pay per click ROI calculator calculates the pay per click campaign profit or loss by deducting the campaign costs from the total income from all conversions, and uses this to work out the return on investment ROI for the campaign.
Pay Per Click ROI Calculator Download
The pay per click ROI spreadsheet is available for download in Excel format by following the link below.
Users use this pay per click software at their own risk. We make no warranty or representation as to its accuracy and we are covered by the terms of our legal disclaimer, which you are deemed to have read. This is an example of an internet marketing roi tool that you might use. It is purely illustrative. This is not intended to reflect general standards or targets for any particular company or sector. If you do spot a mistake in the return on pay per click calculator, please let us know and we will try to fix it.
About the Author
Chartered accountant Michael Brown is the founder and CEO of Plan Projections. He has worked as an accountant and consultant for more than 25 years and has built financial models for all types of industries. He has been the CFO or controller of both small and medium sized companies and has run small businesses of his own. He has been a manager and an auditor with Deloitte, a big 4 accountancy firm, and holds a BSc from Loughborough University.