ROI for Samsung

Today, I will discuss about what ROI (Return on Investment) is and how to calculate it. I am going to use an organization to calculate their ROI and explain what kind of tangible and intangible benefits they earn from their investment.

ROI - return of invertelment concept in word tag cloud on white background

ROI (return on investment) is how much profit or cost saving is realized. An ROI calculation is sometimes used along with other approaches to develop a business case for a given proposal. The overall ROI for an enterprise is sometimes used as a way to grade how well a company is managed.

There is the formula of ROI:

calculating-roi5

Samsung is the largest mobile phone maker in its home market of South Korea and the third largest in the world. In addition to mobile phones, Samsung also manufactures things such as televisions, cameras, and electronic components.

Samsung-Logo

Samsung has always used social media to increase their ROI. For example, Samsung used Facebook ads to promote Samsung Galaxy S3 smart phone in 2012. Samsung spent $10 million dollars and achieved $129 million in sales directly attributable to their Facebook campaign. Here is more information.

1samsung-fblogout-370x229

There is the ROI formula of Samsung:

Cost of investment = $10,000,000

Gain of investment = $129,000,000

ROI = [($129,000,000$10,000,000) / $10,000,000] x 100%

ROI = 1190%

It was very high percentage. The mean is that Samsung had great gain through using Facebook ads to promote Samsung Galaxy S3 smart phone. Their Facebook page was joined by more people. So, that is what tangible benefits they earned. Samsung also earned a great intangible benefit. There were many people to know Samsung through Facebook. That was a great chance to increase their reputation.

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Thank you for reading and please leave some comments.

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8 thoughts on “ROI for Samsung

  1. Nice post, Samsung looks like they made a huge return on their investment thanks to the Facebook ads. Do you know any other type of advertising they used to make the Galaxy S3 such a huge success?

    • thank for your comment.
      I think they used YouTube to advertise Galaxy S III. In their YouTube official channel, there were over 6 million people to watch the video about introducing Samsung GALAXY S III.

      Introducing Samsung GALAXY S III: A Day in the Life:

  2. What a impressive ROI Samsung made for the Samsung Galaxy note III ! It seems they mainly used Facebook to promote their product, don’t you think they could use a broader type of social media to increase even more their ROI ?

    • thank for your comment,
      I agree with you. they should use a broader type of social media to increase even more their ROI. So, I believe that they are not just using Facebook to advertise Samsung Galaxy S4 in this time. They may invest more money to different social media such as YouTube, Twitter and etc.

      • I think it has become necessary to use as many channel as they can since they are directly in competition with brands like Apple, for which communication is an asset !

  3. Very interesting numbers, with a comparison of $10 Million for marketing budget to an impressive $129 million in sales. Samsung is a great example of an organisation gaining in both tangible and intangible benefits. Do you think without the addition of social media Samsung would be as successful in their revenues?

    • thank for your comment,
      I think Samsung would not be as successful in their revenues without using Facebook or other social media, because Facebook is a the best social media in the world. There are much people to join and use Facebook every day. That is why Samsung used Facebook to advertise, because they known that could be easy to attract people from Facebook.

  4. Hi there,

    What a very practical blog post providing us with some calculations. I am just wondering, where do you get the number of cost of investment and gain of investment from? Is there any calculations behind it? Thanks.

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