Marketplace advertising ROI

Ad ROI on a marketplace is the percentage return on investment in advertising campaigns, calculated as the ratio of net profit from ads to total ad spend. A simple formula: ROI = (Sales revenue − Advertising spend) / Advertising spend × 100%.

How advertising ROI is calculated

For an accurate calculation you need three key metrics: revenue, direct advertising costs and variable costs per sale (cost of goods and platform commissions). Calculation steps:

• Step 1. Count gross revenue directly attributable to the ad campaign — typically by click or view-through attribution, depending on Kaspi settings.
• Step 2. Sum all advertising expenses: clicks (CPC), paid impressions, promo activities, participation fees for promotions.
• Step 3. Subtract from revenue the variable costs for sold units: cost of goods sold (COGS) and Kaspi commission (category-dependent, e.g. 5–15%).
• Step 4. Compute net profit from the campaign and apply the ROI formula.

Numeric formula: ROI (%) = (R − A − V) / A × 100, where R — gross sales revenue, A — advertising spend, V — variable costs (COGS + commission). An alternative useful metric is ROI per click: ROI_click = (CR × (AOV × (1 − commission) − COGS) − CPC) / CPC × 100.

Why it’s important for a Kaspi.kz seller to calculate ROI

• Budget control. Without ROI, it’s easy to overspend on campaigns that have high visibility but low returns.
• Identifying profitable SKUs. ROI shows which product cards actually generate margin after commissions and COGS.
• Channel optimization. Comparing ROI across Kaspi ad products (search impressions, card sets, banners) helps reallocate budget toward formats that work.
• Growth planning. Knowing ROI lets a seller estimate how much can be invested in scaling while maintaining target profitability.

In practice, sellers in Kazakhstan use ROI to decide: whether to increase a search bid for a specific keyword; which items to move into promotions; which SKUs to push to external advertising.

Calculation examples on Kaspi.kz — real scenarios

Below are three simplified scenarios based on typical figures from sellers in Kazakhstan. All numbers are illustrative but close to real practice.

Scenario A — low-cost item (accessories)

• Average order value (AOV): 5 000 KZT
• Cost of goods sold (COGS): 2 000 KZT
• Kaspi commission: 10% = 500 KZT
• Conversion from click to purchase (CR): 4% (0.04)
• CPC: 50 KZT
• Profit per sale after COGS and commission: 5 000 − 2 000 − 500 = 2 500 KZT
• Expected profit per click: CR × profit per sale − CPC = 0.04 × 2 500 − 50 = 100 − 50 = 50 KZT per click
• ROI on click: 50 / 50 × 100% = 100% (a 100% return on ad spend per click)

Viewed at campaign scale: 1 000 clicks cost 50 000 KZT, generate 40 orders (1 000 × 0.04), revenue 40 × 5 000 = 200 000 KZT, variable costs 40 × (2 000 + 500) = 100 000 KZT, gross margin before ads 100 000 KZT, net profit after ad spend 100 000 − 50 000 = 50 000 KZT, so campaign ROI = 50 000 / 50 000 × 100% = 100%.

Scenario B — mid-price electronics

• AOV: 35 000 KZT
• COGS: 20 000 KZT
• Kaspi commission: 8% = 2 800 KZT
• CR: 2% (0.02)
• CPC: 300 KZT

Profit per sale after COGS and commission: 35 000 − 20 000 − 2 800 = 12 200 KZT. Expected profit per click: 0.02 × 12 200 − 300 = 244 − 300 = −56 KZT: negative. That means at these rates the campaign loses money — you pay more per click than the margin generated by expected conversions. To get positive ROI you must reduce CPC, increase CR (better card, reviews, images), raise AOV or lower variable costs.

Scenario C — higher-priced item with promotional discounts

• AOV before discount: 80 000 KZT
• Promotional discount/bonus applied: 15% → effective AOV: 68 000 KZT
• COGS: 40 000 KZT
• Kaspi commission: 7% = 4 760 KZT (on discounted price)
• CR: 1.5% (0.015)
• CPC: 700 KZT

Profit per sale: 68 000 − 40 000 − 4 760 = 23 240 KZT. Expected per-click profit: 0.015 × 23 240 − 700 = 348.6 − 700 = −351.4 KZT → negative. Here the promotion and commission reduce margin significantly; ROI is negative unless you can improve conversion, avoid deep discounts in paid placements, or lower CPCs. For high-ticket items it’s crucial to model promotional effects and returns before scaling spend.

Practical tips to increase ROI

• Track attribution correctly. Use Kaspi’s attribution settings consistently and align analytics windows across campaigns.
• Segment SKUs by profitability. Don’t average ROI across all SKUs — focus budget on profitable items and pause or rework low-margin ones.
• Optimize product cards. Improve titles, photos, descriptions and reviews to raise CR without extra ad spend.
• Adjust bids by performance. Use ROI_oriented rules: raise bids on high-ROI keywords/cards and lower or pause low-ROI ones.
• Calculate ROI with all variable costs. Include discounts, promo fees, returns and delivery where applicable.
• Run A/B tests. Test creatives, promo formats and landing flows to find high-CR combinations before scaling.
• Use promo channels selectively. Some Kaspi promo formats increase visibility but add fees; test their net effect on ROI before wide adoption.

Common mistakes and how to avoid them

• Ignoring commissions and promo fees — always calculate ROI after Kaspi’s commission and any participation costs.
• Mismatched attribution windows — use the same attribution model across campaigns to compare results fairly.
• Averaging ROI across product mixes — split by SKU or margin groups to take correct decisions.
• Forgetting returns and refunds — they reduce effective revenue and must be included in variable costs.
• Scaling on visibility alone — high impressions don’t equal profit; validate with ROI and CPA metrics.

How AWW helps sellers increase ROI

• Attribution and end-to-end analytics setup to correctly attribute orders to campaigns and channels.
• Automated bidding based on ROI rules, so bids adjust to target profitability rather than only traffic.
• SKU segmentation by profitability and automated rules to prioritize high-margin items.
• Optimization of product cards (copy, images, pricing) and running A/B tests on promofeatures.
• Monitoring participation in Kaspi promotions and recommending the most efficient promo formats for each SKU.

Short conclusion and practical tip

Calculate ROI for each campaign and SKU, including all variable costs and commissions. Use ROI_click for quick bid decisions, but validate scaling with full campaign ROI. Practical tip: start with a small, controlled budget for tests — optimize CR and card conversion first, then scale ads where ROI is clearly positive.