Email marketing is considered to be one of the most effective forms of communicating to your audience online. The proverbial holy grail.
According to research conducted by Nielsen, 27% of customers subscribe to in-store emails to stay informed, and a surprising 27% of online shoppers subscribe to receive coupons and discounts.
With those surprising statistics, it’s obvious that customers prefer to be contacted by email to stay updated on new products and discounts.
However, there’s so much more you can do with email marketing – and sending one-off promotions barely scratches the surface.
Other popular email marketing campaigns proven to be effective include personalizing emails, sending out promotions on products that are relevant to a certain demographic and emails based on past purchases.
These are only a few strategies content marketers pull out of their arsenal… the sky is truly the limit.
However, growth cannot be measured unless you have proper metrics to go along with it. That’s where Key Performance Indicators (KPI’s) come into play.
Email marketing success can be determined only when you’re able to measure the performance of your marketing campaigns.
The metrics discussed in this post will provide key areas you should be tracking to understand the performance of your emails. This useful information can improve the way you market, increase conversions, boost your revenue and at the same time, keep your subscribers engaged.
The Seven Most Important Elements To Measure Include:
Click rate or click to open rate is thought of as one of the most important KPI’s in email marketing.
Simply put, it’s the number of subscribers who opened your email and clicked the link. This metric measures unique subscriber clicks.
How To Calculate A Click Rate Or Open Rate?
Let’s suppose you have 50000 subscribers, and your email broadcast gets delivered to everyone on your list…
To obtain your campaign’s Click Rate – divide the number of clicks by the number of emails delivered, and calculate the percentage (multiply by 100).
If you had 1000 clicks… your click rate would be 2%.
While click rates or CTR can vary by industry, data is also available on the general benchmarks. You can compare the benchmarks with the CTR that you are measuring for your list.
Silverpop’s 2015 email marketing benchmark study revealed that the overall median CTR was 1.6% for all countries combined.
Click rates are also available by industry, which can be very useful for benchmarking.
It’s interesting to note that the highest median CTR is for Nonprofits.
It’s important to not confuse conversions with getting a sale. Conversions can also be as simple as getting subscribers to download a whitepaper.
If a subscriber performs a desired action you encourage – it’s called a conversion.
Your conversion rate can be calculated by dividing the number of people who completed the action you desired, by the total number of email deliveries made, and multiplying by 100.
In reference to the example above – 50,000 deliveries with 1000 subscribers who completed your desired action will provide you with a 2% conversion rate.
An Unsubscribe Rate often provides you with a reality check. If your emails aren’t targeted or they’re too promotional in nature, you may experience an increased unsubscribe rate.
Unengaged subscribers who don’t open your email, let alone unsubscribe, will also contribute to a low subscribe rate.
There’s a reason why unsubscribe rates are an important metric.
Unsubscribe rates have become even more important since Gmail introduced the easy Unsubscribe button. (Gmail has a 16% market share and Google Android another 10%). Subscribers can now unsubscribe easily with just one click, and most people may be inclined to do so for irrelevant or untargeted promotions.
The mean overall unsubscribe rate according to Silverpop’s research stands at .019%.
Bounce rate is determined when you send an email to the list, but it fails to go through.
To calculate your bounce rate, divide the number of bounced emails by the number of emails sent and multiply by 100. If 100,000 emails were sent and 1000 bounced, the bounce rate would be 1%.
It’s important to note, there are two kinds of bounces— soft bounces and hard bounces.
A soft bounce indicates the presence of a temporary problem with the recipient – like the inbox being full or the bandwidth exceeding normal limits.
On the other hand, a hard bounce will indicate that the email address does not exist. To lower the bounce rate, it’s imperative to remove all non-existent email ids from your list.
Here are some interesting hard bounce statistics from Silverpop:
As you will notice above, the median hard bounce rate is approximately .0018%.
Total Number Of Sales Or Revenue Generated:
Email revenue refers to the revenue you can generate with your list.
Revenue is defined as the total amount of money received for goods sold. If you aren’t able to generate significant revenue from your email marketing efforts, you may be marketing to the wrong audience. It’s often easier to generate good revenue from a targeted audience.
List Growth Rate:
It’s imperative that you continuously add new subscribers to your list so that you maintain the health of your list with good deliverability.
You can grow your list by creating and offering new lead magnets and implementing content marketing and guest blogging strategies.
To measure the growth of your list – note the change of the number of subscribers, divide by the total number of subscribers, and multiply by 100.
If you add 100 new subscribers in September and lose 20 due to unsubscribes or spam complaints, the change would amount to 80. If your list size is 10,000, your growth rate would be .8%.
Engagement often decreases the longer the person is on the list. A report by MarketingSherpa states, the average B2B email list decays by 2.2% per month.
Subscribers are most engaged when they sign up, and then it tends to be a downhill trend. To keep track of this measurement, it’s important to remember you can segment your list by the date your subscribers signed up.
You should also measure how engaged your older subscribers are. If rates are too low, a re-engagement email series may be necessary.
A re-engagement strategy will help you win back your subscribers and increase your conversion rate.
Here’s an excellent example of a re-engagement email.
As you saw above, just building an email list isn’t enough. There are different metrics at the core of managing an email list that can show you how engaged your subscribers are. Understanding these metrics can help improve your revenue and fuel your subscriber growth.
If you’ve taken the time to build a clean list of over 50,000 subscribers and would like to find out how you can earn residual income on an ongoing basis by monetizing your list… contact us for a complimentary strategy session BELOW.