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When the first electronic mail was sent back in 1971, the historic moment sparked a revolution that would change the way how we not only communicate but also how we build businesses. It has become an essential tool in the marketing sector, where marketers fully utilize this channel as a direct and cost-effective method to power their acquisition strategies.
It’s not surprising that an email is still a top-performing tool for businesses and with good reason. Your email marketing efforts can reach a wide audience at a relatively low cost compared to other forms of media exposure. An email is also versatile in a way that it brings your brand to consumers through an eclectic mix of graphics, links, and custom text.
However, it’s important to note that you have to measure email marketing campaign performance to find out if your efforts are not in vain.
This makes it crucial to understand email marketing data. Here are the important metrics that you should measure to gauge email marketing campaign performance:
6 Metrics to Measure Email Marketing Performance
#1. Open Rate
An email’s open rate is the percentage of people who clicked on the email with the intent to read its contents. This is generally considered as one of the most important metrics to watch out for. If your email is left unopened, your message won’t get seen.
To boost your chances of having your email opened, there are two factors you need to consider:(1) the subject line and (2) the preview text. For best results, keep it short, simple, and straightforward yet creative. Also, make sure your email is personalized to your target audience’s interests.
Formula: No. of emails opened / no. of emails successfully delivered x 100
#2. Click Rate
The click rate or clickthrough rate (CTR) is the percentage of those who clicked on any of the links in your email. There are two kinds: unique clicks and total clicks.
Unique clicks are those coming from different IP addresses while total clicks include the overall clicks including those from the same devices.
Your CTR will show you how effective your email message is and how compelling your call to action or link is. So, if you’re getting lots of opens but not as many CTRs, it’s a telling sign that you need to tweak your email’s message or CTA button.
Formula: Total no. of unique clicks / no. of emails sent x 100
#3. Bounce Rate
You will need to track your bounce rate and classify each of them if it’s ‘soft’ or ‘hard.’ A soft bounce happens when a problem is due to a recipient’s inbox or email exchange server, in which case the email you sent gets stuck in server limbo (usually temporary).
Hard bounces are what you should avoid, since they mean you’ve contacted an invalid, inactive, or non-existent email addresses with zero chances of getting delivered. To make matters worse, your ISP can track all these hard bounces and reduce your sender score, which can affect email deliverability in the future.
Formula: No. of bounced emails / no. of emails sent x 100
#4. Conversion Rate
The ultimate goal of your email marketing campaign is to get your target audience to convert. This happens when someone clicks on your email and takes the action you want them to take (such as downloading an eBook, signing up for a newsletter, or any other action listed in your conversion goal).
Knowing your conversion rate will allow you to determine if your email marketing campaign is effective, from your subject line down to your CTA and landing page.
Formula: No. of people who performed the desired action (e.g. sign up or purchase) / no. of emails delivered x 100
#5. Unsubscribe Rate
This is the rate of people who have unsubscribed from your mailing list, which isn’t good for your campaign. Although, it’s worth noting that the unsubscribe rate doesn’t paint a reliable picture of the health of your mailing list since many subscribers who may have grown tired of receiving emails from your brand won’t even bother going through the formal unsubscribe process. They’ll just stop opening your emails altogether.
The smarter approach to measure subscriber engagement is through CTR and conversion rates. From there, you can observe those who are unengaged and eventually take them out of the equation for a more accurate measurement of your email marketing campaign.
Formula: No. of unsubscribes / no. of messages delivered x 100
#6. List Growth Rate
Your list growth rate is simply the rate at which your email list is growing. This is a good metric to keep tabs on aside from your CTR and conversion rates. Your goal here is to keep it at a healthy size and constantly increasing so you can continue to expand your audience reach and position your brand as a thought leader in the industry.
Formula: ([(No. of new subscribers) – (no. of unsubscribes + email or spam complaints)] / total number of email addresses on your list]) x 100
#6. ROI (Return on Investment)
Despite not having a set formula in calculating the ROI of your email marketing campaign, you could generally measure this by dividing the return you made by the cost you incurred throughout your entire email campaign.
The best way to boost your ROI is to focus your efforts on lead generation. You should be tracking how many leads convert so you can measure the revenue you’ve generated.
Formula: Additional revenue/value generated by the campaign / total campaign costs
The Bottom Line
Metrics will always be essential when measuring your performance, particularly in your email marketing campaigns. With these telling figures, you’ll be able to analyze your strategies and make adjustments when necessary.
Email marketing may be simple and direct in concept, but you should know how to customize your emails to target your audience more effectively. Armed with the right knowledge to drive conversions, you can up your email marketing game in no time!
This guest post was written by the Spiralytics Team. Spiralytics is a full-service agency that specializes in marketing that’s backed by data science. Contact us today to find out how we can grow your business!