What Is a Good Marketing ROI Ratio? Measuring Success & Maximizing Impact
If you’re in marketing, there’s a good chance someone has asked you to defend your budget using return on investment (ROI).
We feel your pain.
In fact, did you know that nearly 40% of marketers say proving ROI is their biggest challenge? That’s a problem! If you don’t know what you’re getting from your marketing investment, you’re flying blind.
Marketing ROI can be seen as a performance metric, but it’s so much more than that—it’s how smart marketers defend budgets, enhance budgets for next year, optimize spending, and shape strategy.
So here’s the real question: Do you know if your marketing budget is delivering actual results?
At COHN, we help businesses turn their data into direction—defining what ROI should look like, how to measure it, and how to improve it quarter over quarter.
In this blog, we do our best to help you calculate marketing ROI, define what “good” really looks like, and inform you where to focus if you want to maximize impact.
Understanding the Fundamentals of Marketing ROI
At its core, marketing ROI measures the revenue generated by your marketing efforts against the cost of those efforts.
The formula is simple:
(Revenue from marketing – Marketing cost) ÷ Marketing cost × 100 = ROI (%)
This tells you how much return you’re getting for every dollar spent. But context matters. A 300% ROI might be outstanding in one industry and just average in another, depending on margins, customer value, and marketing goals.
So what’s considered “good”?
This is going to vary quite a bit based on industry, brand maturity, macro-factors… but anything on the positive side is good.
It has been said that a 5:1 revenue-to-cost ratio is very strong. That means for every dollar you spend, you’re earning five in return.
A 10:1 ratio is exceptional, but rare—typically found in high-margin industries or products with strong word-of-mouth appeal. On the other end, a 3:1 ratio may be acceptable for competitive or lower-margin businesses.
The type of marketing channel also matters. SEO and content marketing often deliver higher ROI over time, while paid search and social ads bring faster results but at a higher cost.
How to Measure and Track Marketing ROI
Tracking ROI starts with clarity, both your goals and your numbers.
First, define the objective. Are you trying to increase brand awareness, generate qualified leads, or drive immediate sales? That answer determines how you measure success.
Once your objective is locked in, establish the KPIs that support it. Common marketing ROI indicators include:
Customer Acquisition Cost (CAC): How much it costs to acquire a new customer.
Customer Lifetime Value (CLV): The total revenue a customer generates over time.
Conversion Rate: The percentage of leads or visits that become paying customers.
Measurement tools matter, too. Platforms like Google Analytics, HubSpot, Salesforce, and marketing automation tools can help tie spend to outcomes with more precision. Smart marketers also track ROI by channel to see what’s working. Whether it’s SEO, email, social, or paid media—channel-level ROI tells you where to invest more and where to cut back.
What Impacts Marketing ROI?
A lot of variables affect ROI, and not all of them are within your control. Industry, competition, sales cycles, and customer behavior all play a HUGE role.
In competitive markets, for example, cost-per-click and cost-per-acquisition are often higher, which can lower short-term ROI. But if brand awareness and market share grow, the long-term gains can outweigh the immediate costs.
The type of marketing channel also makes a difference.
SEO and content marketing tend to have high ROI because they compound over time, but they require patience. Paid channels like Google Ads or paid social deliver faster results, but costs can spike quickly. Email marketing consistently performs well because of low costs and high retention potential.
Sales cycle length is another factor. B2B brands or service-based businesses often have longer decision timelines, so ROI may take months to materialize. But if the customer lifetime value is high, a lower upfront ROI may still be worth the investment.
Strategies to Improve Your Marketing ROI
Improving ROI isn’t just about cutting costs. It’s about making better decisions—smarter targeting, more efficient channels, and higher conversion.
Start by refining your audience segmentation. The more precise your targeting, the less you spend on unqualified leads. Use behavioral data and retargeting strategies to engage people who’ve already shown interest.
Next, allocate budget based on performance. Don’t stick with channels that aren’t pulling their weight. Redirect spend toward those consistently delivering conversions at the right cost.
Improving your conversion rate is one of the fastest ways to lift ROI. Test landing pages, headlines, and calls-to-action regularly. Remove friction from the buying process wherever possible.
Don’t overlook retention. Acquiring a new customer is more expensive than keeping an existing one. Loyalty programs, re-engagement email campaigns, and personalized content can help extend the customer lifecycle—and your ROI along with it.
Finally, revisit how you’re measuring attribution. If you’re still relying on last-click data, you’re missing the full picture. Multi-touch attribution gives you better insight into what’s driving conversions across the funnel.
Common Pitfalls That Hurt ROI
One of the biggest mistakes marketers make is chasing vanity metrics. Impressions, likes, and shares can feel good—but they don’t always translate to revenue. Focus on metrics tied to bottom-line outcomes: leads, sales, and customer value.
Attribution modeling is another trap. When companies rely solely on last-click attribution, they often undervalue top-of-funnel efforts that prime a lead for conversion later. A more holistic model helps distribute credit more accurately and reveal hidden opportunities for optimization.
Then there’s the issue of inertia. Too many businesses set a strategy, launch it, and walk away. But great ROI requires iteration. You should be analyzing trends, shifting budget, and refining messaging based on what the data tells you—not just following a plan because it’s already in motion.
And finally, retention is often overlooked. Brands focus so much on new acquisition that they forget to nurture the customers they already have. If you’re not keeping the people you’ve already paid to acquire, your ROI will always lag.
What’s Next: Trends That Will Shape ROI in 2025
Marketing ROI is getting smarter—and so should your approach. AI-powered analytics are helping brands make real-time optimizations and predictive decisions faster than ever before. Attribution models will get more advanced, and privacy regulations will push companies to rely more on first-party data.
Expect to see greater emphasis on personalized, automated campaigns that adjust dynamically based on customer behavior. The brands that win will be the ones that connect data to action—consistently and ethically.
COHN Marketing: Your Partner in ROI-Driven Strategy
At COHN, we don’t believe in guessing. We use data, insight, and experience to help brands create marketing strategies that are measurable, optimized, and built for long-term impact. Our team specializes in connecting performance metrics to business outcomes—so you always know where your budget is going, and why it matters.
Ready to raise your ROI? Let’s talk.
