Email Marketing KPIs: What to Track?posted on 20-3-18-Wed 22:48
|What is Email Marketing?|
|Why is Email Marketing So Important?|
|Top 5 Tips for Effective Email Marketing|
|14 Email Marketing KPIs You Should Be Tracking Right Now|
If there was ever a tried and true marketing tool, it is email marketing. Despite people exaggerating its demise, all indications show that email usage is growing all around the world. As of 2018, there were 3.8 billion email users globally, and that figure is estimated to reach 4.4 billion in 2023 . With that said, anyone who is remotely serious about marketing can not leave out email marketing if they truly wish to make revenue.
As with anything in business, email marketing needs to serve the company’s strategic goals. That is where email marketing KPIs come in to tell you if you are heading in the right direction with your email campaign. Without them, your email marketing campaign would most likely not produce the desired results.
So keep on reading to find out what those email marketing KPIs are.
What is Email Marketing?
Before you start discussing what email marketing KPIs to track, let us define what email marketing is. To put it simply, email marketing is the utilization of email to communicate with existing and potential customers for commercial purposes. Each one of us has most likely received a promotional email or two during our lifetimes, making us a party to email marketing.
There are various email messages that businesses and brands send over the course of an email campaign. The most common ones include a:
- Product and service promotional email
- Welcome email
- Event invitation
- Follow up email
- Social media send email
- Confirmation email
- Tutorial, tips, guide, free ebook or any other informational email
- Seasonal promotional email
- Cart abandonment email
- Digital newsletter and magazine email
Why is Email Marketing So Important?
With the large user base that email has around the world, an email marketing campaign puts your business and brand in front of global consumers. There is no company that would ever pass up an opportunity to reach a global audience if growth and profitability are on their mind. Other than this, email marketing comes with a number of other benefits that make it worthwhile.
Here are the other big reasons why email marketing is so important.
Easier to Measure than Traditional Marketing
There are a variety of email marketing tools out there that not only help you get started with your campaign but help you measure its success. Being a digital form of advertising, it is easier to measure any email marketing KPI and metric in real-time and get the insights you need. From there, you can easily ascertain if there is something wrong with the email campaign.
It Helps Bring More Traffic to Your Website
When you include links to your main website in your emails, they can bring in more web traffic. Once on your website, your target audience can get acquainted with other aspects of your business. They might even discover something else on your website that they needed (they didn’t know where to look or never thought they needed at all).
And with the ability to include social sharing buttons in your emails, you increase the likelihood that your content will be shared across multiple social media channels. This means more people will click on your links and be directed to your main website. And the more traffic you get, the more leads you will most likely get as well.
Emails Give You a Higher Chance of Conversion
With emails, the chance to convert the people on your list is high. If you think about it, these people willingly gave you their emails so they can hear more from you. They are only a step away from becoming a paying customer and you just need to seal the deal. You can do this by sending the engaging and personalized emails that touch on their pain points while offering a solution, giving you an even bigger chance to convert.
It Builds Strong Relationships With Customers
Email marketing is one of the best ways to build a relationship with your customers. Sure, you can call them and ask them how they liked your product or service and how you can improve, but that is time-consuming. Plus, you can catch them at a bad time, which will make them less likely to cooperate with you. With emails, you give your customers a chance to get back to you in their own time while also making them feel valued by asking them to get involved with your business.
Sends Subscribers Targeted Messages
Buy knowing who your subscribers are and what they want, you are in a better position to send them targeted emails for higher conversion. For example, if you are running a promotion on fashion accessories, you can make sure that only the people who are interested in fashion accessories get those promotional emails. These are emails you wouldn’t want to send to someone who is interested in sports. By sending emails to the right people, you get a higher open rate and people won’t unsubscribe from your list because you are sending something irrelevant.
It Helps Increase Revenue
While the other benefits are big, this one is the biggest. With email marketing, you can expect to boost your sales. In fact, for every dollar you spend on email marketing, you can expect an average return on investment (ROI) of $42 . This doesn’t come as a surprise, considering how popular email is.
It is a Cost-Effective Marketing Solution
Traditional marketing channels are far more expensive when compared to email marketing. With email marketing, there are no fees to pay to get on popular traditional marketing channels, such as TV and billboards. There are no overhead costs for producing materials for print media such as magazines. You might just need to pay fees for the email marketing software that you will use to send email blasts, but even that is far less costly and extremely worth it in the end.
Top 5 Tips for Effective Email Marketing
Now that you know what the benefits of email marketing are, you can’t enjoy them if you don’t do email marketing right. Indeed, many people think they can freestyle it and expect to get results. However, there are certain things that you must do in order to make sure that your emails are making an impact and increasing your bottom line.
Here are five of those things:
1. Prioritize Engagement
When you are formulating your email campaign, engagement should be a priority. The volume of emails you send doesn’t matter if engagement is low. When you are sending your emails, make sure that you encourage people to engage with your business and brand rather than just sending them news on your latest products, services, promotions and deals.
Focus on forging long-term relationships with your customers, instead of just contacting them when you need their business. Doing the latter is bound to build a bit of resentment. If that happens, you will see your email campaign fail.
2. Start Campaigning Early
If you have a seasonal promotion coming up, it is always best to start as early as possible. Take a cue from retail stores. When they sense that the holidays are nearing, you see them putting up decorations and offering their promotions in early November. If you have such a holiday promotion coming up, do the same if you want to get as many people as possible on board – don’t wait until the first week of December.
3. Always Include a Call to Action (CTA)
Once you have engaged your customers, always tell them the next step to take. That is why it is suggested to always include engaging CTAs throughout the email. You could be telling them to call you for more details. You could also be sending them to the main website to download an important resource or make a purchase or booking. Whatever you do, don’t forget to include engaging CTAs if you wish to see results.
4. Start Referral Programs
Referral programs are a great way to get more business for yourselves and give your current customers an opportunity to save. You can tell them that by referring to a friend, they will be able to save a certain percentage on their next purchase or booking. And the people they refer your product or service to are likely to them up on it because word of mouth is extremely powerful.
5. Do A/B Testing
A/B testing also works with email campaigns and is less costly than with traditional marketing. Basically, this is where you send out different versions of the same campaign and see which one your target audience engages with the most. After you figure out which one is performing better, you can focus on that one to increase conversions and make more sales.
14 Email Marketing KPIs You Should Be Tracking Right Now
Now that we have discussed email marketing in little detail, we can start talking about the email marketing KPIs. As mentioned earlier, these KPIs are essential to making sure that your company manages to meet your strategic goals. Usually, these goals include increasing the number of customers to make more revenue.
By tracking the right email marketing KPIs, businesses and brands can make informed decisions to make sure that their email marketing efforts are delivering results. And with so many KPIs to track, it is extremely important to know which ones to prioritize.
If you have ever wondered which email marketing KPIs you need to be tracking, we will talk about 14 of them below. Then it is up to you to use an email campaign monitor like MailChimp and Sendinblue to keep track of them.
1. Number of Subscribers
In order to determine if investing in an email campaign is worth it, one needs to look at the number of subscribers they have. Without any subscribers, there would be no email campaign. If the number of subscribers is lower than expected, then one needs to take action and make sure that people are encouraged to subscribe.
2. Overall ROI
You can’t judge the success of their email marketing campaign without keeping an eye on this extremely useful KPI. As the name suggests, it tells you how much ROI your email campaigns are bringing in overall. This can tell you whether you need to invest more in the campaigns or cut your losses.
This number is a percentage. To calculate it, you have to take all the sales you have made from your email campaigns and divide it by the total costs of all your campaigns. Then, you multiply the result by 100 to know how much your overall ROI is.
3. Email Delivery Rate
Just because you are sending out your emails, it doesn’t mean that they’re all getting delivered. You need to have a realistic view of the number of emails you expect to be delivered depending on the size of your mailing list. Then you should compare this expected number to the email delivery rate to see if you are hitting that target.
To calculate this KPI, take the total number of emails that were delivered and divide them by the total number of emails sent. To get the actual email delivery rate, multiply the answer you get by 100. Even though an email delivery rate of 100% is what we all want, 95% is ideal.
4. Open Rate
Another important KPI to track is the open rate. You also can’t assume that everyone who gets your email will open it – although that would be ideal. Some people will get that email and won’t even open it, leaving it sitting in their inbox perpetually or until they decide to delete it.
To calculate the open rate of your emails, you should take the total number of emails that were opened and divide that number by the total emails that were sent. Once you multiply that number by 100, you will get your open rate. You should aim to have an industry-standard open rate, which is between 15% and 25%.
5. Revenue Per Email
Not your ROI investment on each individual email will be the same. By looking at this KPI, you can see if the emails you are sending are affecting your ROI positively or negatively. By knowing which ones are underperforming, you can take a closer look at them to see what you can do to improve them so they perform better.
6. Click-Through Rate
In an email campaign, it is fair to say that a great number of your emails will contain a link that specifies the desired action you want the reader to take. It could be a link to redeem a coupon code for a discount on their next purchase or to download an infographic or PDF. Whatever the case, the click-through is a percentage of the people that clicked on a link placed within an email.
To calculate this number, you divide the number of emails you sent containing a link by the total number of emails you sent overall. After multiplying that figure by 100, you will get your click-through rate. If the average click-through rate for your email campaigns is 2.5% and above, then you are well within the industry standard.
7. List Growth Rate
Is your list growing or not? This is something you need to know, and the list growth rate is the KPI that tells you this. If your list is growing, it tells you that what you are doing is working. And if it is not or even shrinking, then it will highlight that there is a problem that you need to solve before you waste a lot of time and money into something that is hemorrhaging subscribers.
List growth is calculated by subtracting the number opt-outs from the number of new opt-ins. Then you divide the answer by the total number of subscribers you previously had and then multiply that by 100. Based on the figure you get, you should know whether your email list is growing or not.
8. Conversion Rate
One of the most important KPIs to track in your email campaign is the conversion rate. A conversion, in this case, is someone who not only clicked on the link in your email but performed the desired action afterwards. If the desired action was for people to make a booking, then you have a conversion every time some makes a booking.
So to calculate this, take the total number of conversions and divide them by the total number of emails containing a CTA. Then multiply that number by 100 to get the conversion rate. The average conversion rate depends on a number of factors, such as size or business and industry, but many think a conversion rate of 4% to 5% is ideal.
9. Social Shares
The number of social shares that emails get is a good indication that your content is engaging. It means people like your offers so much that they want others to get in on it – word of mouth. This is why when you are creating content for email, you have to add social sharing buttons for people to find it easy to perform that action.
Another way to judge how many people are advocating for your products and services is by looking at the number of forwards you get. When someone forwards an email to a family and friend, it means they know there is a high probability that they will take action. Always count on personal recommendations to carry more weight since a lot of people trust them.
11. Bounce Rate
A bounce rate is one of these email marketing KPIs that you must track because it tells you how deliverable your emails are. Emails bounce for many reasons. It could be that there was a temporary problem with the recipient server ( soft bounce ). It could be that the person entered the wrong email address and there’s no way that email could ever be delivered ( hard bounce ). Whatever the case, don’t skip this KPI.
As you can tell, this KPI is the opposite of the email delivery rate. So to calculate it, you take the total number of emails that bounced and divide that number by all the emails that were sent. Finally, you multiply the resulting number by 100 to reveal the bounce rate.
12. Spam Complaints
Like the bounce rate, the amount of spam complaints you are getting is not a pleasant KPI to look at. When a subscriber receives an email they consider to be spam, they will click on the “report spam” button in their email client. Not only will this bar you from sending them any emails, but your email provider will be keeping track of the scam complaints you are getting – you should too.
When the scam complaints get too high, the email provider might be forced to take action against your account. To them, you are sending emails that people find annoying, effectively degrading their user experience. So you need to act on spam complaints to make sure they remain at a minimum.
13. Unsubscribe Rate
Sadly, not everyone on your email list would like to remain there. And you shouldn’t force them to remain there. Give them a chance to unsubscribe if that is what they want. Unfortunately, others will choose this option and you need to track the percentage of people that unsubscribe.
So to calculate this dreaded figure, divide the total number of unsubscribes from your previous total of email list subscribers (before the unsubscribing brought the number down). After you multiply the result by 100, you will have your unsubscribe rate.
14. Average Order Value
Another important KPI to measure is the average order value or AOV. Basically, it tells you how much customers are spending on average every time they make a purchase or order on your website. To get the number, you simply take the total number of sales and divide them by the total number of purchases or orders.
If you are thinking about moving forward with your digital marketing campaign, you can’t skip email marketing. Compared to other forms of marketing, especially traditional forms, email has a high ROI and is cost-effective. That is why it is extremely important to know what email marketing KPIs to keep track of. Well, now you know 14 must-track email KPIs.