ROI Analysis

Definition of ROI Analysis

The evaluation of the return on investment from various business activities or investments.

Explanation of ROI Analysis

ROI analysis, or return on investment analysis, is the process of evaluating the profitability and effectiveness of an investment or business initiative. This involves comparing the gains or benefits generated by the investment to the costs incurred. ROI is typically expressed as a percentage, calculated by dividing the net profit by the initial investment and multiplying by 100. ROI analysis helps businesses assess the value of their investments, make informed decisions, and prioritize resources. Effective ROI analysis requires accurate data collection, thorough analysis, and a clear understanding of the goals and objectives. By leveraging ROI analysis, businesses can optimize their strategies, improve financial performance, and achieve better outcomes.

This dictionary entry was written by

Per-Gulbrand Peter Braathen

With a foundation in doctoral-level research, Per-Gulbrand Peter Braathen is a seasoned expert in the areas of marketing, branding and communication. His proficiency extends to marketing management, branding and communication strategy. Braathen's experience is underscored by his rich background from various industries, including entertainment. A distinguished alumnus of the USC Marshall School of Business, Braathen boasts a Master of Science in Marketing, complemented by a Graduate Certificate in the Business of Entertainment from the USC School of Cinematic Arts as well as two undergraduate Bachelor degrees from the esteemed University of Southern California.