Welcome, dear community! Today, we’ll talk about a metric that can be confidently considered the most crucial in Affiliate Marketing – ROI. What is it, how is it measured, and most importantly – how can you improve this indicator? Learn more from our new material.

Before we start, we traditionally remind you that we always talk about all important aspects of an Affiliates work, including metrics. For example, recently we discussed how the CLV metric works in iGaming and why it is necessary. We recommend you read it.

What is ROI?

ROI stands for “return on investment.” This metric shows how effectively you use the money spent on your campaigns. It includes all categories of expenses: from the cost of the advertising itself to the price of various tools you use in your work.

Unlike many other metrics, if your ROI is 100%, it is not necessarily a sign of success. A 100% ROI only indicates that your investment has paid off, but you did not make a profit. Essentially, if your ROI is less than 100%, you are at a loss; if it is more, then you are making a profit.

ROI is the main indicator for every Affiliate. Nothing else shows the effectiveness of your work as well as the profitability of your projects.

How is ROI Calculated?

There is a single formula that helps accurately calculate ROI. This formula is not only used in Affiliate Marketing but also widely applied in general. It looks as follows:

(Net profit – Campaign costs) / Campaign costs x 100

For instance, if you earned $100 and your expenses were $10 spent on purchasing ad space, then your net profit is $90. Accordingly, by applying the formula, we get an ROI of 900%, because (100 – 10) / 10 x 100 = 900.

In our example, we demonstrated how to calculate basic ROI. However, there are more comprehensive variants. The formula itself doesn’t change, but the approach to what is considered costs does. While calculating basic ROI, Affiliates generally only count advertising expenses, but for a comprehensive calculation, you should consider all expenses: hosting, software purchases, money for creatives, and so forth.

Also, remember that it’s sometimes hard to calculate net profit, especially if you are working on complex projects where the team funnels traffic to several offers with different payment methods. Because ROI also involves a large list of various key metrics including conversions, subscriptions, sales, etc.

How to Improve ROI?

Now let’s talk about the most important part – how to improve your ROI. To earn more profit from your advertising campaigns, you need to:

  1. Reduce the costs of conducting campaigns
  2. Increase the effectiveness of your campaigns

It seems simple at first glance, but we’re here to delve into each of these aspects in detail.

To reduce campaign costs, you need to be meticulous in choosing the source of traffic and in setting up the campaigns. For example, a common beginner’s mistake is incorrect target setting, where the Affiliate tries to reach everyone who somewhat fits the target audience parameters. More precise targeting not only reduces costs but also increases conversion. Thus, it’s a win-win for improving ROI.

Pay attention to commissions. Often, you can find the same offer in different affiliate networks where payouts differ. Always choose the one where you can earn the most.

Choose quality creatives and use all available tools to attract as many leads as possible to your offer. Particularly, don’t forget about aspects that directly affect conversion, not just clicks. First and foremost, this refers to the landing page (or pre-landing page, depending on the setup). It should be the perfect end to your sales funnel, making your profits soar.


ROI is a key indicator in Affiliate Marketing that reflects how effectively you are performing your work. Some trackers allow you to conveniently track ROI based on basic indicators. However, if you aim to precisely determine your actual ROI, it’s necessary to count every penny, as we’ve described above.

How do you calculate ROI, or do you not pay attention to this metric and work purely intuitively? We look forward to seeing you and hearing your cool stories in our Telegram community!

Respectfully, Your Geek!

What is ROI, and How to Improve It FAQs

What is ROI in Affiliate Marketing?

ROI stands for ‘return on investment,’ which reflects how effectively you use the money spent on campaigns.

How to calculate ROI in Affiliate Marketing?

The formula is as follows: (Net profit – Campaign costs) / Campaign costs x 100. For example, if you earned $100, and your expenses were $10 spent on buying ad space, then your net profit is $90. Accordingly, by applying the formula, we get an ROI of 900%, because (100 – 10) / 10 x 100 = 900.

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