The 7 Most Important Email Marketing Metrics For Ecommerce
Metrics always go in step with business activities. Only by measuring the effectiveness of your actions can you figure out which of them is best to implement and what has to be discontinued.
This article contains the most important email metrics that have to be measured when implementing your email marketing strategy. We’ll also be looking at how to measure and improve them because every email marketing metric here has a purpose and each metric must be improved.
These email marketing metrics are going to be important in helping you reach your ultimate goal, conversions. After all, the purpose of any marketing effort is to help increase sales, whether that’s by promoting new products or increasing brand loyalty.
Keep reading and find out what your email marketing measures tell you about your ecommerce marketing strategy and business approach.
The Main Ecommerce Email Metrics You Should Follow
Today we’re going to be looking at a few email marketing metrics you should track to ensure that your business is growing.
But naturally, there’s one important question you’d like to answer: what is the most important metric in email marketing?
For that, the answer is simple: the conversion rate.
Conversion Rate – the most important metric in email marketing
The crown in the email marketing metric kingdom belongs to conversion rates. The reasoning is pretty clear: all your marketing activities are aimed at increasing your sales.
And your conversion rate measures how many of your contacts ended up completing a desired action. Here, that desired action is most likely a purchase—although another “conversion” rate can be related to newsletter signups.
The average newsletter signup rate is around 2%. This means that only 2% of all website visitors enter their addresses to get on your mailing list.
Sumo.me provides one more interesting number. They say that the top 10% of marketers get an average 4.77% signup rate. Most likely, this means that a 5-6% conversion rate is the best you can expect in terms of signups.
Email conversion rate
The most important conversion rate in email marketing is the email conversion rate. This is the number of sales made from a particular campaign, divided by the number of emails sent and multiplied by 100.
You sent a campaign to 10,000 of your subscribers or customers. This campaign generated 210 orders.
210/10,000 * 100 = 2.1% (this is your conversion rate)
The email conversion rate benchmark, at least for promotional emails, is around 2%, although this went up considerably in 2020 as can be seen in our Ecommerce Statistics Report:
But if you personalize your campaigns, you can expect this number to be a bit higher. Beyond that, automated workflows bring in significantly higher results, going as high as 51.94%—much higher than the average conversion rate for email marketing:
Conversion rates are crucial to understanding how well your marketing strategy and email campaign are performing. The more conversions you have, the more you can ensure your campaign is targeted correctly and help you move toward your overall business goals.
The vast majority of email service providers do not provide sales reports and conversion rate metrics. You can get these numbers only by measuring your results in Google Analytics.
At this point, Omnisend has a big advantage. Due to our seamless integration with ecommerce platforms like Shopify, Shopify Plus, Bigcommerce, and WooCommerce, Omnisend is able to provide in-depth reports of the sales for each separate email campaign. This way, you can easily see how well each of your campaigns perform and compare it with other campaigns.
If your conversion rate is low, try to answer the following questions to yourself:
- Is this the right audience for these kinds of emails?
- Is the offer enticing enough?
- Is the message clear enough?
We should always think about who we are addressing, what we are offering and what language we use to convince people to buy from us. These three factors should always be in harmony to get a great conversion.
ROI – crucial for evaluating your email marketing strategy
By calculating the return on investment or ROI in email marketing, we can evaluate the effectiveness of your email marketing investment. Basically, retailers determine what they gained from the investment on email marketing and how much they spent on it.
The return on email marketing investment formula is as follows:
(Revenue – Spent)/Spent = Return on Investment %
In this formula, what you earned is the sum of all sales made through email campaigns, automated workflows, etc., over a certain period of time. It doesn’t really focus on the number of emails you’ve sent.
Expenses include the email service fee, plus the salaries to email marketers, designers and other people who helped to implement your email marketing plan over the same period of time.
However, it can sometimes be difficult to come up with a definite price for the time spent on designing emails, writing copy, picking the right products, etc. If you don’t have specific numbers, your ROI can become inaccurate.
For that reason, many ecommerce marketers measure more tangible things, such as the ROI for their email marketing tool.
To do so, you simply add up your revenue over the month, subtract the monthly email service fee and divide this number from the amount of money spent on the monthly email service fee.
Let’s say from email marketing campaigns and automated workflows you earned $20,500 last month. Your monthly fee for Omnisend was $228.
(20,500 – 228)/228 = 88.9
So for every $1 spent on Omnisend, you earned $88.90.
If you do the most of email marketing work on your own, this measure is more accurate than measuring ROI.
The click-through rate refers to how many email recipients clicked on at least one link within the email campaign. This metric is also one of the top email marketing metrics that email service providers indicate in their reports.
At Omnisend, we also add UTM parameters to every link so you can see the traffic from your email campaign in your Google Analytics account.
Besides that, all the clicks can be seen in the click map in your campaign report. It counts the unique (unique clicks on the different links) as well as total clicks (all the clicks, including multiple clicks from the same recipient).
A click map helps a lot when you try to understand what parts of the email are effective and what should be improved.
Your click rate indicates how interesting your email content is to its recipients. This includes how compelling was the copy, how clear and actionable the CTA (call to action) buttons were, how good or bad the layout was, etc.
These are the three tips on how to make your emails more clickable:
1. Make them easily scannable
Whatever email you send, it should have a clear structure. To separate different content blocks, use spacing and lines. People rarely read long emails nowadays, so make the key points easy to see and make sure they are followed by CTA (call to action) buttons.
2. Segment your recipients and tailor your email content accordingly
People engage more with emails that contain relevant information. This might be achieved if you segment your audience according to their demographics, shopping behavior, interests, you name it.
And don’t take my word for it: Omnisend’s annual report shows exactly that. The average click rate of a bulk email campaign is 4.89%. Meanwhile, the segmented campaign gets on average a 7.43% click rate.
3. Make it easy to click
If you want your email to be clicked, you have to make sure it’s easy to click.
This might seem obvious. However, I often get promotional emails that are overwhelmed with different kinds of information. It’s not clear what the most important part is and what I should do exactly within those emails.
So don’t push too much information into one email. It should have a focused message and a limited number of CTA (call to action) buttons. Make them bold.
In email marketing metrics, bounce rate has a different meaning than in Google Analytics.
Whereas bounce rate in relation to your website refers to how quickly a site visitor got the heck out of there, in email marketing this metric refers to the percentage of your emails that failed to reach their destination. In other words, something prevented an email from reaching a recipient’s inbox.
This could be due to different reasons:
- a recipient has a full inbox (soft bounce)
- the email address no longer exists (hard bounce)
- the domain (email ending after @) does not exist (hard bounce)
- the server is not accepting emails (hard bounce)
- the address is mistyped ([email protected] instead of [email protected], etc.) (hard bounce)
If you get hard bounces, remove those addresses from your list ASAP. Read more about the bounce rate and why it can be a real troublemaker.
The average bounce rate for ecommerce is 0.5%. A bounce rate greater than 4% indicates a stale contact list and can damage your sender’s reputation with no possibility to regain it.
Uh-oh. If your spam rate starts to rise, you’re running into trouble.
Your spam rate refers to how many people you’re annoying. Essentially, individuals are flagging your emails as spam. Not cool.
However, 0.1% is a reasonable spam rate. Anything more than that needs to act as a red flag, causing you to rethink and clean your email list. A big complaint rate might spoil your sender’s reputation, which means that your future emails will not be delivered to recipients.
Fortunately, it’s easy enough to get around spam.
- For one thing, always ask for permission before emailing someone.
- Secondly, let people know what to expect from your future emails.
- Thirdly, despite being an ecommerce business, don’t include an offer in every single email.
- Last but not least, try to send fewer emails. An increasing spam rate might also indicate too-frequent messaging.
The unsubscribe rate is nowhere near as bad as it may first sound.
There always will be people who unsubscribe from your emails. It’s heartbreaking but that’s okay. It happens to all retailers.
The average unsubscribe rate for ecommerce is about 0.25%. So you shouldn’t worry about unsubscribes unless you get a significantly higher rate of declines.
These are the common reasons for potential underperformance:
- The email contains some (race, gender, beliefs) intolerance.
- The email list is stale itself. People on that list are no longer engaged with your brand.
- Your emails are too frequent.
- Your emails are too aggressive in terms of sales.
The last on our list is now, unfortunately, also the least. That’s because open rates are dying — at least when iOS 15 rolls out.
The open rate was once one of the most important metrics, reflecting your recipient engagement in general, and for a short time it will still have value. However, due to the fact that open rates will become irrelevant, ecommerce marketers will have to learn to trust in other email marketing metrics.
Open rates are self-explanatory and refer to the percentage of your subscribers or customers who have been encouraged by a catchy subject line to open a particular email. All email platforms provide this metric in each email campaign report, so there’s no need to calculate this number by yourself.
Some email marketing professionals are skeptical about the accuracy of this metric due to technical nuances. But they impact the metric too slightly to make a significant difference.
However, open rates can teach us some things about our email campaigns:
- Which headlines work best for your subscribers or customers?
- Which days are the best in terms of open rates?
- What part of your contact list is still engaged with your brand and responsive to your messaging?
While the metric is a piece of cake to understand, achieving high open rates and strong engagement is less easy.
If you read any book on copywriting, they’ll tell you that the best subject lines either arouse curiosity or provide a benefit to the reader. The subject line should also be short, punchy, and avoid spam-related words such as “free” and “cash.” Find out more about the best-performing subject lines.
For different ecommerce fields, the average email open rate might vary. For ecommerce businesses that sell apparel, accessories, books and small tech-gadgets, the average open rate of a promotional email campaign is 18.3%.
However, if you segment your subscribers and tailor campaigns according to their interests or behavior, this open rate benchmark is significantly higher – 28.05%. Which means that segmented campaigns can earn you a 34.7% higher open rate than bulk email campaigns.
In our article today, we looked at the multiple email metrics that you’ll have to be aware of in order to understand the strengths (or weaknesses) of your email marketing strategy.
Beyond that, we also showed what you need to do in order to improve these email marketing metrics, whether that’s by increasing conversion rates, or decreasing bounce rates.
The key points here are:
- Your conversion rate, click rate, ROI, bounce, spam and (for now) open rates are your key email marketing metrics
- Segmented/personalized email campaigns get better rates than bulk email campaigns.
- Measuring ROI for email marketing is inaccurate unless you have a dedicated team and can measure the expenses spent on overall email marketing strategy over the month/year or another certain period of time. It’s far more straightforward to measure the ROI for your email marketing tool
- Use the open rate to identify the effectiveness of your subject lines.
- Click rate indicates the quality of your email: starting from layout and copy, and ending with CTA buttons.
- The conversion rate for emails varies a lot: the more personalized and better-organized the email content is, the higher the conversion rate will be.
- Avoid exceeding spam and bounce average rates. By keeping these metrics high you can spoil your sender’s reputation.
- No one can escape unsubscribes. However, make sure your emails don’t contain offensive, abusive or other negative information that could raise your unsubscribes.
- Remember the golden rule: “What gets measured gets managed.”
Thanks to Michelle Deery from Heroic Search for contribution to this article.