# Lead Gen ROI Calculator — Formulas and Definitions

## Definitions

- **Monthly sessions**: Number of website sessions in an average month.
- **Baseline conversion rate**: Percentage of sessions that become leads.
- **Average deal value**: Average revenue per closed deal.
- **SQL to close rate**: Percentage of leads that close into revenue.
- **Timeframe**: Number of months used for incremental impact totals.
- **Gross margin (optional)**: Percentage of revenue retained after direct costs.

## Core formulas

1. `monthly_leads = monthly_sessions * (conversion_rate / 100)`
2. `monthly_revenue = monthly_leads * (sql_close_rate / 100) * average_deal_value`
3. `annual_leads = monthly_leads * 12`
4. `annual_revenue = monthly_revenue * 12`
5. `timeframe_revenue = monthly_revenue * timeframe_months`

## Scenario formulas

For each uplift scenario:

- `scenario_conversion_rate = baseline_conversion_rate * (1 + uplift_percent)`
- Conversion rate is capped at **45%** for realism.
- All output formulas are then re-run with the scenario conversion rate.

Incremental value:

- `incremental_monthly_revenue = scenario_monthly_revenue - baseline_monthly_revenue`
- `incremental_annual_revenue = scenario_annual_revenue - baseline_annual_revenue`
- `incremental_timeframe_revenue = scenario_timeframe_revenue - baseline_timeframe_revenue`

## Sensitivity guidance

To avoid misleading precision, the calculator presents a practical planning range:

- `low_range = incremental_timeframe_revenue * 0.8`
- `high_range = incremental_timeframe_revenue * 1.2`

If gross margin is set:

- `low_gross_profit = low_range * (gross_margin / 100)`
- `high_gross_profit = high_range * (gross_margin / 100)`

## Caveats

- Linear extrapolation model only (no seasonality or channel-mix effects).
- Useful for prioritization and planning, not guaranteed forecasting.