Open Rates Are Not Enough | Step Up Your Game with These 5 Email Marketing Metrics
Running email marketing campaigns? It only takes 5 metrics to track to get the most out of your campaigns and blow everybody’s mind.
When you get started with email marketing there are plenty of guides that will help you, whether it’s how to set up your first campaign or to write killer subject lines. However, with a plethora of things on your desk, you’ll want to know exactly which marketing efforts are paying off. Here’s where data will become your sidekick.
Tracking your email marketing data can be a piece of cake and has the potential to make email marketing your ROI and acquisition king, if you focus on the right metrics.
Why Open Rates Are Not Enough
If you ask email marketers which metric(s) they track, the first answer often is open rates – sounds familiar?
The open rate measures how many of your email recipients actually opened your email. Tracking this metric can tell you how well your subject line resonates with your audience and if it stands out in the inbox of your subscribers.
When I started email marketing, I dedicated a lot of my time optimizing subject lines and every additional percentage in my open rates gave me a rush of excitement. Higher open rates are a great thing – agreed. But it is only the tip of the iceberg.
We have all been there. You put your heart into an email marketing campaign that should take your audience’s socks off. You write a killer subject line that gets everybody to open your email. But does it take them further? Does it increase your website traffic? And does it help you reach your actual business goals? You can build the most beautiful emails – they will be irrelevant if you cannot see the results of your efforts.
Let’s go over the 5 most important metrics, and also take a look at how to tie them to your specific goals.
Start Tracking These 5 Metrics Today
Before you do anything else, stop for a second and think about what you are trying to reach: Growing your subscriber database, converting existing leads into customers, etc.?
The goal you define will determine the metrics that are most relevant for you.
1) List Growth Rate
Even the best content and the greatest Call-to-Action buttons are irrelevant, if you do not have an audience to talk to. Most email marketers focus entirely on the metrics that help you optimize your content and increase conversions on your site. The list growth rate is often overlooked. But this metric, that calculates the rate at which your email list is growing, is one of the most important ones.
It’s calculated by the cleaned number of new subscribers (meaning, minus your unsubscribed and spam reports), divided by the amount of email addresses on your current list.
For example: 200 subscribers recently joined your email list, 6 unsubscribed, 2 reported your email as spam, and your email list contains 4,000 subscribers. Your current list growth rate is:
Here’s the thing: Naturally, your email list will decrease by about 22% yearly. People change their email address, abandon old addresses and unqualified leads opt out of your email communication. You share this fate with all the other email marketers out there. Nothing to worry about, if you are prepared. You will have to think of strategies to continuously generate new leads. If you need some ideas, Andy Pitre collected a comprehensive list of actions to take.
Clearly, you can trigger your readers’ curiosity with a mysterious subject line and get them to open your email. But the real value comes from the ones who click a link inside your email and engage with your content further. In order to estimate this, you have to measure your Click-Through-Rate (CTR).
To calculate it, you divide the number of clicks by the number of successfully delivered emails. Note that the number of clicks can be clicks by an individual person, or individual clicks. Imagine one recipient clicks on a link in your email three times. While the former recognizes one click only, the latter counts three clicks. Both ways are fine. Pick one way and stick to it.
Say, you send out an email campaign to 210 subscribers. 200 emails are delivered successfully (turns out you had 10 false email addresses in your list). 10 people clicked on the content in your email. Your CTR for this campaign then is:
The CTR is an important metric for marketers to determine the value of their content. If it’s is high, the content of your email probably resonates well with a large amount of your subscribers. You can also use this metric to calculate the performance of each individual email and determine how they develop over time. And if you are using more than one Call-To-Action (CTA) inside an email, it will help you detecting which one performs best.
What is a good CTR? Believe it or not, if your CTRs are ranging between 4 – 5 percent, you are pretty much nailing it. As IBM shows in a recent study, CTRs top out around 9.5 percent globally, with highest rates in the Computer Hardware & Telecommunications sector, Non-Profit Associations and Education; and lowest rates for Travel Services and Computer Software & Online Services (between 2.4 and 2.7 percent). Keep that in mind, when you monitor this metric.
3) Conversion Rate
You wrote a great subject line, created a high performing Call-to-Action – what happens after your subscribers followed a link in your email? What do they do on your website? The Conversion Rate (CR) is one of the most important metrics you should track. It tells you the percentage of your email recipients who click on a button or link within the email and complete an action that result in a ‘conversion.’ Basically, it helps you understand to which extend you are achieving your goal.
Small businesses usually have to decide on a few marketing efforts to start with – and my last company was no exception. There was a time when we almost shifted away from email marketing to focus more on other marketing efforts. The conversion rate was the one saving us from doing so, as it showed us that email marketing had the biggest (positive) impact on our retention rates – which in turn is highly effective for conversion.
Calculating your CR is fairly simple. Just divide your number of sales that derived from your email marketing campaigns by the number of visits from your email recipients. So for example: 1,000 people visit your site this month, coming through your email campaigns. Out of these, 30 are converting, resulting in a conversion rate of:
To get started, you need to integrate your email platform with your web analytics tool. Create unique UTM parameters, simple tags you add to your URL, for each link you want to include in your email. This will let you follow your subscribers on their journey from your email to your website and gives you an understanding of what works best.
This being said, apart from knowing “what” happens, it is essential to know “why” something is working/not working. Understanding the “why” will help you get to know your customers much better, and eventually guide you along the conversion funnel. Make sure you use a program that helps you with the “why” just as much as with the “what”. The next time you check your CR dig a little deeper. It’s worth it.
4) Bounce Rate for your Landing Page
*Note: This is not the Email Bounce Rate, which tracks how many of your emails could not successfully be delivered due to temporary error (e.g. full inbox) or a permanent problem (e.g. email address does not exist).
Your landing page is like inviting someone to your home. How long they will be staying (and considering coming back), highly depends on their first impression. It’s the same with your email marketing. You put a lot of effort in your campaigns to get your readers to click a link and visit your website. But if your landing page does not match with your email, nobody will engage with your site further.
A visitor is defined to bounce from your site if he
- Closed the window or tab again
- Clicked the “Back” button to leave your site
- Clicked on a link to a page on a different website
- Typed a new URL
- Did not do any action on your site for a while and his session ended
Let’s say 1,000 visitors came to your website this month. Out of these, 60 people left your site right away again (they bounced). This leads to a Bounce Rate of:
High bounce rates signal that your email campaign and your landing page message are not aligned. Most likely, your audience expected something different, when they clicked the link in your email and left your site, because it was not relevant for them.
Here’s the good news: There is a lot you can do to avoid high bounce rates, such as matching the content of your email and landing page, reducing external links in your website, building a clear navigation path, etc.
Being a fully data-driven marketer sometimes requires some detective work from you. The more information you get, the better you understand what needs to be changed. For example: You send an email campaign in which you link your readers to a certain landing page. But the visitors who arrive using through mobile, significantly drop out of site, because the landing page is not responsive for mobile devices. You can only get to the bottom of this, when you track where your visitors landed (landing page), through which marketing channel they came from (email) and on which platform they operated (mobile). The program you choose to track your data with, should give you the option to view various dimensions at the same time.
5) Total ROI
As for every marketing channel, you want to know how profitable your email marketing is for your company. And how do your campaigns perform in comparison to your other marketing efforts? This is measured by the total ROI (Return on Investment). Or in order words: How much do you earn in comparison to how much you spent for your email marketing?
It’s a known secret: Email marketing is the undefeated ROI champion of all marketing channels. If done correctly, it can earn your business $44 and more for every dollar you spent – and knock your boss and your sales team of their feet.
The formula for this metric sounds more difficult than it actually is. To determine your ROI, you calculate what you earned from your email marketing, minus what you spend on it. If you have earned $10,000 from your email marketing the last period and spent $2,000 on sales and email marketing (e.g. costs of your email service provider, the time you spent on email marketing, etc.), your ROI is calculated as follows:
Meaning, for every $1 you spend on email marketing, you earn additional $4. Pretty cool, right?!
The hardest part will probably be to collect all the data. Start with all your costs. Some might be tricky to define, such as personnel working on email marketing. Be as precise as possible with your estimation and include all the costs related to your email marketing. I tried to keep track of all my costs in a file in order to make it easier on me.
And now to the sales: You need to know how many of your leads, that generate revenue for your company, arrived through email marketing. For that, tracking your website visitors is essential. There are some good tools on the market to help you, such as Oribi – I wouldn’t work here if I wasn’t a fan myself. It’s a cool analytics tool, which tracks:
- where your website traffic comes from,
- reports right away when something important (e.g. a sales) happens,
- and helps you understand which channels boosts your conversion rates.
Different from other solutions, you will simply add a small script to your site and get all your data in no time, served to you on a silver plate.
Once you track your data and have collected the information needed, tools like Sleeknote offer a simple solution to calculate your email marketing ROI easily.
Rock that data! Before you run your next email marketing campaign, think about the goals you want to achieve. Don’t back away from using data. It can help you learn from your audience and channel your efforts to achieve the best results, so take advantage of it. Choose your metrics according to the goals you are aiming for and make sure you are tracking them with a good tool that provides you with all the options you need.
Data is becoming the hub of every business. As a result, you will find a lot of support on the market. Web analytics software, such as Oribi, help you understand the data you are dealing with, to focus on the right metrics, and to not miss any important event on your website, making you a fully data-driven superhero marketer.