In eCommerce, ROI could be defined as an estimate of the return of an investment. It could either be a financial gain or net profit. Business owners often use ROI to check on the success of a business strategy they adopted for their eCommerce business. In fact, ROi is one of the most important metrics for online business.

1. HOW TO CALCULATE RETURN ON INVESTMENT (ROI) 

So we have this formula:

ROI = (PROFIT – INVESTMENT) / INVESTMENT x 100

By calculating ROI this way, you could gain a realistic insight into the profitability of each marketing strategy.

2. TIPS FOR IMPROVING RETURN ON INVESTMENT (ROI) OF YOUR ECOMMERCE BUSINESS

2.1. Improve your conversion

First of all, be clear:

• Show your customers the final price, with all taxes included as well as shipping rates based on their location.
• Product images: It is important to take clear photos of the product in good lighting conditions and from every angle.
• Social proof: You should also include previous customers’ reviews so as to create a sense of trust from your shoppers.

2.2. Increasing the average checkout price

How? Here are some tips for you: 

• Cross-selling: When a shopper is checking out an item, make sure to recommend them products that are related to that item as well. For example, if they are looking at watercolours, you should also recommend sketchbooks and paint brushes.
• Packs: Another strategy here is to create packs which include different items sold in bulk with a cheaper price, which could ensure higher revenue. You could also add in items that are hard to sell to prevent overstock.
• Free shipping: Customers always love the free delivery offer, there is no doubt. Simply offer them free shipping on orders over a certain price and see your revenue going up.

2.3. Understand buyer persona

To put it simply, the more you understand your customer, the more you will be able to give them what they actually want, thus increasing your sales.