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Chapter 12. Advertising > Calculating a Return on Your Investment

Calculating a Return on Your Investment

We stated earlier in this chapter that the critical reason for stores to advertise is to gain new customers who hopefully become repeat customers. Now let's look at some straightforward calculations for gauging your return on your advertising investment. When you advertise on the Web, you can measure the actual return on an advertising investment because you can monitor the results of the ad campaign and measure the difference to determine whether your advertising campaign met expectations. Using the accepted averages of click-throughs and purchases, the resulting formula looks like this:

Number of Impressions * Average Click-Through Rate * Average


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