Google Ads ROI Calculator

How to use this Google Ads ROI calculator

To calculate your Google Ads ROI, first select whether or not you have already completed your ad campaign.

If your answer is yes, enter your Google ad cost, your revenue from Google Ads, and any additional cost, such as agency fees, that you might have incurred.

If your answer is no, enter your target revenue from your campaign, your average revenue per conversion, your expected conversion rate, and your expected cost-per-click (CPC).

Based on your inputs, the tool will instantly calculate your current or expected Google Ads ROI, giving insights into your ad campaign.

Google Ads ROI formula

Google Ads ROI = ((Total Ad Revenue- Total Ad Cost) / Total Ad Cost) × 100

Here,

If your campaign is already completed,

Total Ad Cost = Google Ad Cost + Additional Cost

If you are planning a campaign for the future, your target revenue will be taken as your total ad revenue, and total ad cost will be calculated as follows:

Required conversions = Target Revenue / Average Revenue per Conversion

Required clicks = (Required conversions / Expected Conversion Rate)*100

Total Ad Cost = Required clicks × Expected CPC

Understanding the Google Ads ROI result

Your Google Ads ROI will depend on various factors such as your industry, competition, and overall ad performance.

• A high ROI indicates that your campaign is profitable and that it will be, or has already been, effectively converting your target audience.

• A low ROI suggests that you may need to optimize your campaigns or increase ad efficiency. If your ROI is negative, it signals that your campaign is a bad investment in its current form and that you need to identify areas for improvement.

When to calculate Google Ads ROI

You should calculate your Google Ads ROI in the following key scenarios:

• After a campaign ends to measure overall success

• Before launching a new campaign to predict profitability

• When comparing the performance of different ad campaigns or keywords

• To determine the right time to scale your budget based on positive ROI

How to calculate Google Ads ROI (with example)

Let us imagine that you have just completed your Google Ads campaign, and your total cost was $500, your total ad revenue was $1200, and you paid $10 to your ad agency. Your Google Ads ROI will be calculated as follows:

Google Ads ROI = ((Total Ad Revenue- Total Ad Cost) / Total Ad Cost) × 100

Let’s assume your monthly investment is $20,000, your CPC is $2, your conversion rate is 4%, your profit margin is 30%, sales per customer is 2, and your average ticket is $500. You can calculate your Google Ads ROI as follows:

Google Ads ROI = ((Total Ad Revenue- Total Ad Cost) / Total Ad Cost) × 100

Total Ad Cost = 500 +10 = $510

Google Ads ROI = ((1200-510)/510) x 100 = 140%

Here, your Google ads ROI was 140%, indicating that your campaign’s revenue was 1.4 times its cost.

Let us take another scenario where you are still planning your campaign. Say your target revenue is $2000, the average revenue per conversion is $10, the expected conversion rate is 20%, and the expected CPC is $0.1. Here,

Required conversions = 2000/10 = 200

Required clicks = (200 / 20 )*100 = 1000

Total Ad Cost = 1000 × 0.1 = $100

Google Ads ROI = ((2000 - 100)/100) x100 = 1900%

In this example, your Google Ads ROI is 1900%, indicating that your campaign is highly profitable, generating 19 times the return on your investment.

How to improve your Google Ads ROI

• Use highly targeted keywords to drive relevant traffic and improve conversion rates

• Optimize your landing pages for better user experience and higher conversions

• Test different ad creatives to find the best-performing versions

• Implement retargeting strategies to capture missed opportunities

• Continuously monitor and adjust bids to lower CPC and increase ROI