ROI Calculator
Maximize Your Return on Investment
Understanding the balance that will yield a breakeven Cost-Per-Order (CPO) is essential to executing a successful DR campaign. This calculator allows you to test your way to an acceptable Breakeven Ratio, which is the first step to improving your ROI. The fields in white boxes are variables that allow you to adjust your numbers – from your desired conversion rate to the price of shipping. The amounts in the grey boxes are then the calculated results based on your settings.
Note: You can hover over the tip boxes ( 
) for more information. We welcome you to print this page for your notes.
Breakeven CPO Formula: A - B = C
Average revenue per sale (A) less the non-media (telemarketing, fulfillment, etc.) costs associated to that sale (B) yields the breakeven CPO (C). The Breakeven CPO is the amount of money you can spend on media (advertising) in order to generate one order and neither make or lose money on the transaction. This number helps us determine what our media target needs to be (i.e. if your BE CPO is $20 and you want a $2 profit on each sale, your target media CPO is $18.
Breakeven Ratio Formula: A / C = D
Average revenue per sale (A) divided by the breakeven CPO (C). Ratio is another indicator of media performance. A ratio is calculated by dividing revenue by the media cost associated with generating it. A 2:1 ratio indicates two dollars in sales for each dollar spent on media. If your BE Ratio (D) is 1.75 and your actual ratio is 1.75, you're breaking even on all costs. If your actual ratio exceeds your BE, you are making money on the front-end.
