Digital Advertising Campaign Margin Calculator
The Digital Advertising Campaign Margin Calculator is used to help calculate what your CPM or Total Budget should be, inclusive of your profit (margin). You can also calculate what your margin percentage is based on the other values.
Fill in any two fields to start calculating the remaining fields:
To use, start entering any two values like cost and margin, and the remainding fields will be calculated for you.
How to calculate profit margin
- Determine your COGS (cost of goods sold). For example
$30. - Subtracting the cost from the revenue to get your gross profit
- Example: Our product sells for
$50. S$20. - Divide gross profit by revenue. $20 / $50 = 0.4
- Express it as a percentage: 0.4 * 100 = 40%
The markup formula is: markup = 100 * profit / cost.
Margin is a simple percentage calculation based on revenue, not on Cost of Goods Sold (COGS) like Markup is.
What is the definition of markup and what is the difference between markup and margin?
The difference between the cost of a product or service and its sale price is called the markup (or markon).
As a general rule of a successful business, markup must be set in such a way as to be able to cover your expenses and produce a reasonable profit.
For example, when you buy something for $80 and sell it for $100, your profit is $20. The ratio of profit ($20) to cost ($80) is 25%, so the markup is 25%.
Markup describes the ratio of the profit to the cost paid.
Markup can be confused with profit margin, which is a similar metric. The profit margin allows you to compare your profit to the sale price, not the purchase price.
For example, when you buy something for $80 and sell it for $100, your profit is $20. To calculate profit margin, we would compare $20 to $100, so the profit margin is 20%.
Profit margin is a ratio of the profit to revenue.