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Courtney Dercqu

Even if you’re not familiar with the term ROI, you use the concept every day when weighing costs and benefits. ROI – or return on investment – is a term used to measure the likelihood you have of gaining a favorable return from your initial investment. The shoes you have sitting in your closet right now are a simplified example. Every purchase you make, large or small, is a small investment–one in which you’d ideally like to see a return. While it may sound basic, you spent money for those shoes after calculating how comfortable they were, how well they paired with other items in your closet, whatever utility you might gain from them, and how well they would meet your overall needs. Those shoes were an investment (a cost) and the style, comfortability, and how well they enabled you to perform daily tasks is the reward. ROI is the measure of how successful the investment of something is considering how much you get back.

A website is a major feature of any business, and your website’s design and functionality should work the same way. Just like you would with buying new shoes, you have to ask yourself: How will a good website design meet my business needs? What is my overall goal of having a website? Is it to increase traffic? Create brand awareness? Make sales? Or market my products? ROI should give you a concrete way to measure what marketing strategies you should implement, maintain, and adapt to in order for your website to succeed.

Have a specific question about website ROI? Feel free to skip ahead using our helpful table of contents listed below:

Table of Contents

What is Website ROI?

roi website

ROI is the metric used to measure the success rate of your initial investment. For websites, this refers to the value brought in through your marketing and search engine optimization (SEO) efforts. Search engine optimization is the process of bringing traffic to your website through organic search results.

But how do you really know that all the effort you put into building your WordPress website is paying off? The answer can be found in your website’s analytics.

What are website analytics?

The collection of data for how long visitors stay on your site and which pieces of content they’re engaging with can all be found in your website’s analytics. The information you find here is important to understand how you should tailor your marketing efforts to your targeted audience. In other words, online ROI simplifies your business decisions because it shows you what’s working and what needs to be improved. Website analytics takes the guesswork out of developing comprehensive marketing strategies.

How can I look at my analytics on WordPress?

While WordPress itself does not offer a built-in option to review analytics, they make it easy for users to do it thanks to the plugins they offer. One of the most popular WordPress plugins to do this is called Google Analytics.

What is Google Analytics?

Google Analytics is a tracking tool that provides invaluable insight into what’s happening on the backend of your website. It is a completely free plugin to add and use. Google Analytics allows you to find out:

  • Which pages on your website perform the best/worst
  • What people are searching for on your website
  • Which online campaigns brought in the most traffic and engagement
  • Where your top visitors are located (important for using targeted ads)
  • How long people are staying on your website

How to Calculate Website ROI

website roi calculator

In order to calculate your website’s ROI, you’ll need to know the total net value of the revenue generated by your consumer over the course of your relationship with them. This is known as your average customer value. In addition to your average customer value, you should also know your annual website cost. This includes the cost of your domain, website hosting, design, ongoing support, and maintenance.

To calculate your website ROI, you’ll use this formula:

[Average customer value x annual customers generated]/annual website cost = website ROI

If you’d prefer to use a website ROI calculator, there are many free and paid options available online.

Examples of online ROI

There are six main types of digital marketing you can use to help grow your business. These include:

  • Video marketing
  • Paid social media ads
  • Sponsored content
  • Email marketing
  • Pay-per-click campaigns
  • Written content

I go into more detail about how you can calculate your return of investment below.

How you can easily calculate ROI

Let’s say you want to generate leads from social media. Major social media powerhouses like Twitter, Facebook, and even LinkedIn all offer opportunities for business owners to set up campaigns targeted at their platform’s users. With 2.8 billion active users, Facebook is often the most popular platform for lead generation.

So let’s say you’re a pet groomer who offers mobile services to those who can’t make it out of the house. Your website is optimized with landing pages about the services you provide, how much your services cost, and the ability for customers to book an appointment. When you run a Facebook Ad, your main target will be those who have pets and/or show an interest in pets in a specific geographic location. You can even target audiences of a specific age bracket.

After you identify your audience, you add a link back to your contact page to see how many new customers the ad brings in. Let’s say you spent $1,000 over the course of your paid ad campaign and brought in five potential leads – how do you measure your ROI’s success rate?

How Do You Measure ROI on a Website?

what is website roi

Let’s use the formula we talked about earlier. During the total time your customer has been purchasing your products, you’ve generated $5,000. This is your average customer value. On average, let’s say you bring in 10 new clients per year, each of which generates about $5,000. In order to find your website ROI, you would multiply your average customer value by the number of customers generated. Your formula would look like this: 5000 x 10 = 50,000. Now you have to divide your total generated value ($50,000) by how much it cost to design, develop and host your website, targeted ad campaigns (including the $1,000 you spent on Facebook ads), and more. Let’s say in total all of those efforts cost you $30,000; after dividing these numbers, your website ROI is 1.6.

With how much money you invested in generating these leads, you actually lost money. This information would then help you tailor this strategy to instead place focus on pay-per-clicks, email marketing, or writing new content to see if you yield better results. If you didn’t know this information, you might continue using a marketing campaign that doesn’t actually generate business.

Website Return on Investment (What Number Should You Strive For)

how do you measure roi on a website

As an average goal, industry experts believe that investors should strive for a 10 percent or higher ROI rate for long-term investments. This is why having a good website design is so important. Good web design is not just how pretty your website looks (although that matters). Rather, it’s about how well your website functions. How long does it take your website to load? Do all of the links and buttons on your website work? Does your written content provide enough value to the user for them to become a potential customer? These factors all play a significant role in generating leads and ongoing business.

This is where having a WordPress website comes in handy. WordPress not only allows you to customize the look and theme of your website, but it also allows you to add valuable plugins like Google Analytics so you can keep track of how you should market to your audience.

Let WP Super Host keep you up to date

When it comes to running a WordPress website, the work isn’t over as soon as your site goes live. At WP Super Host, we understand that most site owners don’t have the time to handle all the technical aspects of their site. That’s where we come in. Our managed hosting service is able to handle the nitty-gritty of your site, including update and plugin monitoring, site security, and site speed reports to see where you need to make improvements. All of our pricing packages are tailored to meet every business owner’s needs and budget. To learn more about our pricing packages and our features, click here.

Final Thoughts

website return of investment

Building a website is a lot of work and it’s important to find out whether or not your efforts are paying off. Website ROI is the lifeblood of your company’s success. It tells you what’s working and what areas you need to improve upon or restrategize. While calculating and measuring the ROI on your website can look intimidating, understanding which formulas to use and how they can be measured is the first step in growing your business. Growing your business takes time but with these helpful tips, you’re well on your way.

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