Over $200 billion dollars will be spent purchasing goods and services online in 2008, according to the brief above from the April 8th, 2008 USA TODAY. The Internet is becoming the major medium for marketing, advertising, and purchasing. This is a powerful revelation for emerging and medium-sized business owners - it levels the playing field with the big guys and allows for tremendous niche and overall market segmentation strategies. Some feel money spent on their website and e-commerce functionalities are costly and even cumbersome. For those that feel this way, I have some news - the numbers don't lie.

This is great financial help for small business owners. Not only do you need to get online, but, with the overwhelming amount of available content, you need a strategy to make your web presence stand-out. So, how do we calculate ROI on web strategies? It is important to note that you cannot trade sales dollars for costs. In other words, you cannot say that you spent $10,000 on your web presence and that if it generates over $10,000 in revenue, then you have made money on the dollars spent.

You must consider your gross margin, because you will have certain costs that will vary with an increase in sales, or, in other words, you will incur costs to provide your products or services. If your gross margin, or the percentage of sales remaining after you subtract your variable costs from your revenue, averages about 30%, then your break-even on $10,000 of investment into the web would be $33,333 ($10,000 divided by .30).