Measure Paid Campaign ROI

Business Context

FitMeal is a subscription-based meal planning app that ran a 6-week paid marketing campaign across Meta, Google, and influencer channels to acquire new subscribers. The CMO wants a clear ROI readout before approving next quarter's budget.

Metric Scenario

The campaign spent $420,000 and generated 18.5M impressions, 310,000 clicks, 24,800 app installs, 9,200 trial starts, and 2,760 paid subscriptions within a 30-day attribution window. Average subscription price is $24/month, gross margin is 68%, and historical 6-month retention for similar cohorts is 55%. Finance reports that first-month net revenue from these users is $66,240, while Product notes that paid users acquired from influencers have higher activation but lower month-3 retention than search users. Leadership wants to know whether the campaign was profitable, which ROI definition should be used, and how to compare channels fairly when conversions and retention happen over time.

Requirements

1. Define the primary ROI metric you would use for this campaign and explain why.
2. Show how you would calculate ROI at both the overall campaign level and the channel level.
3. Distinguish between short-term ROI, payback period, and LTV:CAC, and explain when each is appropriate.
4. Identify the key funnel and retention cuts needed to diagnose performance differences across channels.
5. Call out attribution, incrementality, and time-window limitations that could bias the result.

Data Available

• ad_spend_daily: campaign_id, channel, date, spend, impressions, clicks
• app_installs: user_id, install_date, campaign_id, channel, device_type
• subscription_funnel: user_id, trial_start_date, activation_date, paid_start_date, plan_type
• subscription_revenue: user_id, charge_date, gross_revenue, refunds, discounts
• retention_cohorts: user_id, acquisition_channel, month_number, active_flag, churn_date
• attribution_log: user_id, touch_timestamp, touch_channel, touch_type, attributed_campaign_id