No. A negative ROI just implies that the ratio of benefit/cost is less than one. If I incur a cost/investment of $100 but it creates value of $200 then I have an ROI of 100%. If this same expenditure instead only produced $80 value then I would have -20% ROI as in the value I’m realizing from my investment is 20% less than the cost of the investment.

I would expect:

  ROI > 1 = profitable ad spend
  0 < ROI < 1 = ad spend does not cover its cost
  ROI < 0 = losing money because of the ad spend (the ad is damaging to your brand)

Ratio can't be negative, they can either be above of below 1. What you are talking about is "$benefit - $cost", not "$benefit / cost".

ROI is (net benefit)/(cost), where net benefit is (gross benefit - cost). Net benefit can be negative, making ROI negative if cost exceeds benefit. GP was using benefit as a shorthand for net benefit, which can certainly be negative.

Even gross benefit could conceivably be negative, if the ads are bad enough! (I.e., a terrible ad might prevent a sale.)

We tend to call most rations below 1 'negative'. Its technically wrong but most people get what you mean when you say it.

Positive and negative are the right words on a log scale :D

Ratio can't be negative, but ROI can. Positive ROI is the percentage of the ratio being 1 or higher. Negative ROI is the percentage of the ratio being less than 1.

Or, from a "common sense" perspective, if I spent $1000 on advertising, and earned $100 in revenue from that investment, my ROI is definitely negative.

As I read it, the amount they were spending on the ads themselves was more than the converted revenue from ad clicks. While the decline was probably (guessing) not linear, spending more on ads led to less than proportionally more revenue. If that had happened I can imagine calling that negative ROI.

That makes more sense!

Thanks