ROI : définition
The term ROI stands for Return On Investment. When you run a business, you spend a lot of money on services, tools and equipment. What about your website? It has a significant cost, and it’s a good idea to ask yourself how effective it is, as well as what you can do to optimise it, the costs of which will be absorbed by the increase in your turnover.
In short, the ROI of your website is its productivity, or the profit it generates. If your site generates more money than it costs you, then your ROI is positive and all is well.
The ROI (in percent) of your website can be calculated using the following formula:
ROI = 100 x (Profit generated by your site – Investment cost) / Investment cost
Let’s take a simple example to illustrate this formula.
Let’s say you have an e-commerce site.
If your site cost €10,000 to build and generates €2,000 a month in revenue for you, you’ll have a positive ROI after 5 months of production (ignoring management costs, web hosting and maintenance).
So for a website you need to calculate the ROI over a given period. In general, the calculation is made for 12 months, i.e. one year of production.
Note: An ROI is negative if the cost of creating your website exceeds its profit.
How can you calculate the ROI of your website?
You’ll need various metrics to calculate your website’s economic performance precisely, and so assess its return on investment.
We offer you a free calculator so that you can find out in just a few clicks how much revenue your website generates, and what prospects you have for increasing your turnover.
You will need the following information.
Your average monthly traffic
This is the number of unique visitors who come to your site every month. To do this, use the analyses in your audit tool ( Matomo analytics, for example), and calculate the average over a period consistent with the age of your business. For example, add up the traffic for the last 12 months and divide the result by 12. This will tell you on average how many new visitors discover your site every month.
The number of leads generated
Remember that leads can be generated in a variety of ways: they can be generated by getting in touch via a contact form, of course, but also by subscribing to your newsletter or downloading your free ebook. In all cases, generating a lead is also synonymous with capturing their contact, often their email address.
Please note that a lead is not a customer. A lead is simply a visitor who has shown an interest in your offer. This is the next stage in your sales tunnel.
If you have an ecommerce site, and the only possible action for your visitors is to buy your products, your prospects are your customers. But don’t forget the other possible forms of connection with your business mentioned above.
The proportion of qualified leads
Not all of those people who have become prospects are potential customers. To find out what that percentage is, you need to know who your target is. That’s why it’s vital to carry out marketing research beforehand, leading to the development of personas.
Let’s take an example. Let’s say you run a sports studio in the Bordeaux region.
You can immediately eliminate prospects who live in Strasbourg or Nice, because they will never become your customers.
However, it’s not a bad thing to have a proportion of unqualified prospects. People who have signed up for your newsletter or discovered your website and shown an interest in your business could well recommend you to friends and family in your catchment area.
Other qualification criteria include, for example
- age range
- income
- profession
- etc
Your closing rate
Now that you’ve estimated the proportion of your prospects who are potential future customers, it’s time to estimate this rate.
You can do this by estimating, based on your experience, how many prospects decide to buy your products or services once you’ve established an exchange with them.
For example, if you offer home pruning and clearing services, and contact an average of 50 qualified prospects (who have expressed an interest via your website by filling in a property maintenance cost simulator, for example), and 5 of them sign with you, then your conversion rate is 10%.
Average basket size
This question and the next one go hand in hand. The average basket is the average amount spent by a customer on a transaction with you.
Let’s take two examples to illustrate this.
- You have an online shop selling shoes. On average, when a customer places an order, they spend €200 on goods in your online shop. The average basket is therefore €200. You can find this information in your ecommerce site’s analytical data (in Woocommerce, for example).
- You sell personalised sports coaching services. You offer 45-minute sessions at €60 and 1.5-hour sessions at €100. On average, you estimate that the average shopping basket for your services is around €90.
Average number of transactions
Do your customers generally make one, two or 30 transactions with you?
If you sell racing cars, the average number of transactions will probably be close to 1.
In our example of an online shoe shop, you may find that your satisfied customers come back regularly to buy new models (for example 4 times on average). You’ll also find this data in your shop’s back-end.
In the example of sports coaching, perhaps you offer 3-month support packages with a weekly session? You can use this as a basis if you don’t have enough data to estimate that the average customer will make 12 transactions with you over the course of their ‘life cycle’.
CRO and SEO: allies to improve your ROI
There are two complementary approaches to making a website more efficient and productive. Depending on your situation, one may be preferable or both may be used simultaneously. Our free ROI calculator gives you a better understanding of the impact of these techniques.
CRO: Optimising the conversion rate
The conversion rate is the proportion of your visitors who turn into leads.
This is the very first phase of your sales tunnel, as described in the previous steps.
To calculate your conversion rate, we will use your traffic data and the number of leads generated.
The aim of CRO work is to increase this rate.
To do this, we will optimise the user experience, making the site more user-friendly, the information more relevant and easier to access, and better guiding the web user towards the desired conversion action (for example, joining your mailing list).
This work requires a thorough understanding of your target audience.
The techniques used will vary according to your target audience.
To sum up, CRO involves identifying all the sticking points, the little grains of sand that slow down your visitors, make them hesitate or even prevent them from converting into leads.
This work may involve reviewing your UX (user experience), your UI (the interface, i.e. the visual aspect of your site), or its functionalities.
As you’ll see with our website ROI calculator, raising your conversion rate by just 1% can make a big difference.
SEO: search engine optimisation
As you can imagine, even with a conversion machine, if no one visits your site, you’ll have trouble generating leads.
There are several strategies you can use to get people to visit your website:
- communicate on social networks, share and send people to your site
- launch PPC-type advertising campaigns (via Google ads, for example)
- become visible
The last strategy is by far the most reliable in the long term. To move up the search results on Google and other search engines, you need to determine which keywords are realistically accessible for your website, based on its current authority.
You will then need to create content according to very precise rules if you hope to be indexed in a good position for the target query.
The rest is simply mathematical.
If the incoming flow increases, and your conversion rate is not zero, you will generate more leads, and therefore boost your income.
Do the math yourself with our free ROI calculator for your website.
Estimate the potential gains for your website, free of charge
Now that you’ve understood the theory, let’s get down to business.
Our tool for calculating the ROI of your website will tell you not only your conversion rate and the money your site is currently generating, but also :
- the gains you can make by increasing your conversion rate (CRO)
- the gains you will make by increasing your web traffic (SEO)
- the combined gains
You can take advantage of a free, comprehensive audit, with delivery of a PDF and discussion of the optimisation strategies you should adopt for your website!
Test our FREE website ROI calculator
A tool developed to find out the profit generated by your website, and the potential gains by working on CRO and SEO.