With the help of data from RAM's advertising measurements, the ROMI (Return on Marketing Investment) calculation gives the opportunity to both discuss and simulate the reasonable and possible outcome of the campaign, says RAM.
"In the past, it has been difficult to understand, analyze and calculate the economic effects of advertising campaigns. We have changed this by providing a tool for ad sales reps and advertisers to work together in order to understand the real impact that advertising plays in increasing advertiser sales," says RAM's head of research Staffan Hultén.
Advertising that focuses on brand building has the objective of providing a long-term effect and should be measured with the aim of understanding how the brand develops over time. True product advertising, however, is used to provide short-term economic effects and RAM's ROMI-calculator is designed just for this purpose.
The starting point for the calculation is RAM’s advertising effectiveness measurement results. The question concerning buying intentions shows the number of potential customers that the campaign generated. Two additional bits of information need to be given to help calculate the true ROMI; the campaign cost and profit/contribution per customer. The tool automatically calculates the potential total profit.
