How to Measure Your Email Marketing KPIs?
How to Measure Your Email Marketing KPIs?
As other digital marketing channels and strategies evolve, email remains the core marketing channel for various brands of all kinds of industries. Creating a powerful email marketing strategy can have a significant impact on your overall marketing strategy success and business growth.
But how do you measure the success of your email marketing efforts? There are some important metrics that you must be measuring as often as possible to make sure that you are doing it right and improve the ROI of your email campaigns.
In this article, we’ll show you how to measure your email marketing effectiveness, what are the benefits of email marketing, what are the best and worst days to send emails, and finally present you with the email marketing best practices how to improve your email marketing performance.
What Is Email Marketing?
Email marketing is a digital marketing channel that uses email to promote your business’s products or services. It is a powerful strategy that helps converting leads into paying customers and increases the retention of existing customers.
There are many types of email marketing emails including email newsletters, welcome emails, lead nurturing emails, transactional emails, and more. They all have a different goal to achieve, but commonly their purpose is to build loyalty, trust, or brand awareness.
Why Is Email Marketing an Important Traction Channel?
Traction’s authors Gabriel Weinburg and Justin Mares say: ‘’ Email marketing is one of the best ways to convert prospects while retaining and monetizing existing customers. It can be used at all stages of the customer lifecycle: to acquire customers, build familiarity with prospects, move customers through your funnel, and retain the customers you already have. There are many legitimate ways to acquire customers using email.’’
Here are a few reasons why email marketing is such an important traction channel:
- Email is the #1 form of communication
- Emails require some form of action
- Email marketing gives you full control on your email list
- Email marketing is one of the most personal marketing channels
- Email marketing is one of the most engaging marketing channels, with very high open and read rates
- Email marketing tools offer you the ability to easily track important email metrics such as open rate, bounce rate, click-through rates, and unsubscribe rates.
Benefits of Email Marketing
Email marketing comes with plenty of benefits for businesses. It’s one of the most successful and effective ways to advertise your business, increase brand awareness, and generate conversations and sales. Keep on reading to find out more about the benefits of email marketing and why your business should incorporate is as part of its overall marketing strategy asap.
Email Marketing Has a Larger Reach
There is no other marketing channel with a wider reach than email marketing. According to Statista‘s survey, the number of active email users has reached 4 billion in 2020 and is set to grow to 4.6 billion users by 2025. That is more than half of the world’s population! Think of how many people around the world your business can reach via email.
Just as a comparison, in 2020, the most popular social media channel Facebook reached 2.6 billion active users.
Email Marketing Is the Preferred Communication Channel
Marketing Sherpa found that the majority of customers want to receive promotional emails. 86% would like to receive emails at least monthly, while 15% would like to receive promo emails every single day.
Unlike social media where people communicate with friends and family on a personal level, email is a more professional medium where users expect to receive information about products and services that they are interested in.
Email Marketing Is Cost-Effective
The cost of email marketing can be much lower compared to other marketing channels. There are no advertising fees, no print or postage costs (here’s another benefit of email marketing – it’s also environment friendly!), or paying for a tv commercial or billboard placement.
The only cost around email marketing is investing in email marketing software that can automate, track, and evaluate your emails, as well as keeping your email lists, and investing in email marketing specialists who knows all email marketing best practices and tricks to grow your customers and profit.
Email Marketing Has a Higher ROI
The most important benefit of email marketing is that it is the marketing channel that delivers the biggest ROI for your company. Campaign Monitor reports that for ten years in a row, for every $1 spent, email marketing generates $38 in ROI. That is an average of 3,800% return on investment for businesses.
The reason for this is that email marketing allows marketers to send highly personalized and targeted emails. You can also segment your email list and only send emails to subscribers that meet certain criteria.
It is no surprise that email marketing is the number 1 preferred channel for marketers.
Email Marketing Is Easy to Measure
Another key benefit of email marketing is that it’s easy to measure what you are doing right and where you are going wrong with your campaigns. In the following section of our article, we will show you exactly what metrics you can measure and how.
Email Marketing KPIs: How to Measure the Effectiveness of Your Emails
So, how to measure whether your email marketing strategy delivers the desired results? We gathered the top 7 email marketing key performing indicators (KPIs) to help you measure the effectiveness of your email marketing campaign and whether they hit your goals:
Your email open rate is one of the most important metrics to keep track of. It is one of the best ways to tell whether your email marketing strategy is working by showing you the percentage of your audience that opens the emails you are sending them. There are a couple of factors that can affect your open rate such as the subject line and the sender’s name.
How to calculate your open rate: Divide the number of open emails by the number of total recipients and multiply the outcome by 100.
For example, if you send out 100 emails and only 45 of them get open, your open rate is then 45 / 100 = 0.45. You multiply that by 100 and you have an email open rate of 45%.
The click-through rate is one of the key email marketing KPIs. The goal of almost every marketing email is to get the subscribers to take action – click on a link that it’s inside the email that often leads to a landing page where the subscribers can buy a product or service or drive traffic to your website.
So, when it comes down to measuring the effectiveness of your email marketing, the click-through rate is a metric that email marketers should keep their eyes on. It shows the percentage of email recipients who clicked on a link inside your email.
How to calculate your click-through rate: Divide the number of people that have clicked on the link in your email by the number of emails that were successfully delivered and multiply the outcome by 100.
For example, if you send out 100 emails and 37 people click on the link within your email, your click-through rate is then 37 / 100 = 0.37. You multiply that by 100 and you have an email click-through rate of 37%.
The factors that affect your email click-through rate include your anchor text, the position of the link within the body of the email, the copy that leads to your link, having a clear and compelling CTA, as well as responsive design.
This email marketing KPI determines whether your content resonates with your recipients. It differs from the click-through rate because it is based on people who opened your email rather than your entire recipient list.
How to calculate your click-to-open-rate: Divide the number of unique clicks by the number of unique opens and multiply the outcome by 100.
For example, if your email receives 30 clicks and 45 opens, your click-to-open rate is then 30 / 45 = 0.66. You multiply that by 100 and you have an email click-to-open-rate of 66.66%.
But what is the difference between opens and unique opens, and clicks and unique clicks?
- Opens – total opens represent the sum total of all opens for an email regardless of how many individual subscribers those opens are generated by.
- Unique opens – unique opens represent the number of unique individuals that open your email, all subsequent opens from the same subscriber are ignored.
For example, if your email is opened by the same subscriber 7 times, that would count as 7 total opens and 1 unique open.
- Clicks – total clicks represent the total number of clicks that were made in all the links that you have sent in your email regardless of how many individual subscribers those clicks are generated by.
- Unique clicks – unique clicks represent the number of subscribers that clicked on your links.
For example, if a subscriber clicks 5 times on a link, this counts as 5 total clicks and 1 unique click.
Bounced emails are sent emails that weren’t successfully delivered to your recipient’s inbox. Emails can bounce due to a couple of reasons and fall under two categories:
- Soft bounce – Is an email that could not be delivered because of temporary reasons. These temporary reasons could be a full inbox, temporary auto-replay, or overloaded server.
- Hard bounce – Is an email that could not be delivered for permanent reasons. These permanent reasons could be an invalid email address or if the recipient has blocked you as a sender.
How to calculate your email bounce rate: Divide the number of bounced emails by the number of emails you have sent and multiply the outcome by 100.
For example, if you have sent 100 emails and 8 of them bounced back, your bounce rate is then 8 / 100 = 0,08. You multiply that by 100 and you have an email bounce rate of 8%.
The conversion rate is also a very important email marketing KPI for marketers as it indicates how effective is your email marketing campaign is and determines your ROI. It shows the percentage of subscribers who took your desired action after reading your email. An example of such an action is getting the subscriber to a landing page where the subscriber will fill out a lead form.
How to calculate your email conversion rate: Divide the number of recipients who took the action you wanted by the number of emails you have sent and multiply the outcome by 100.
For example, if you have sent 100 emails and 26 people took the action you wanted them to, your conversion rate is then 26 / 100 = 0,26. You multiply that by 100 and you have an email conversion rate of 26%.
List Growth Rate
The list growth rate is the rate at which your email list has grown over a certain period of time.
How to calculate your email list growth rate: Divide the number of new subscribers – the number of unsubscribes by the total number of email addresses on your list and multiply the outcome by 100.
For example, if you have 50 new subscribers, 10 unsubscribes and an email list of 400, your list growth rate is then 50 – 10 / 400 = 0,1. You multiply that by 100 and you have an email list growth rate of 10%.
The unsubscribe rate is the percentage of your email subscribers who decided that they don’t want to receive emails from you any longer.
How to calculate your email unsubscribe rate: Divide the number of people who have unsubscribed from your email list by the total number of emails that got delivered and multiply the outcome by 100.
For example, if you have sent 100 emails and 5 people unsubscribed from your email list, your unsubscribe rate is then 5 / 100 = 0,05. You multiply that by 100 and you have an email unsubscribe rate of 5.
What Is a Good Open Rate for Email Marketing?
Let’s go back to the open rate. After you already know how important it is and how to calculate it, you are probably wondering what is a good open rate for email marketing.
It is a tricky question. According to Smart Insights, the average email open rate is 16.97%, but the average email open rate varies dramatically from one industry to another.
Still, there are many studies out there that can give us an idea of what to expect:
Email Marketing Open Rate by Industry
While looking at the average across all industries see how you are stacking up against the benchmarks for your specific industry:
Best Days to Send Marketing Emails
One of the most frequently asked questions related to email marketing is: What is the best time to send emails? Which day of the week and at what time?
So, is there a perfect time to send emails?
The truth is that there is no perfect time. We are sorry to break it to you, but what works for others doesn’t necessarily mean that it would work for you too. There are tons of studies trying to answer this question and while some of these studies are in agreement, others are completely contradictory.
Every email list is made up of a different set of people, with different interests and habits. So, what should you do to find out what is the best time to send emails is to test what would work best for your own audience.
But if you are just starting out with email marketing it is important for you to have a place to start. For the purpose of this article, we relied on data about the best days to send marketing emails from Campaign Monitor. That is what they have found:
Best days for email marketing:
- Best day for email marketing with highest email open rates: Friday (18.9%)
- Best days for email marketing with the highest click-through rates: Friday (2.7%)
- Best days for email marketing with highest click-to-open rates: Wednesday and Friday (14.4%)
Worst days for email marketing:
- Worst day for email marketing with lowest email open rates: Saturday (17.3%)
- Worst days for email marketing with lowest click-through rates: Saturday (2.4%)
- Worst day for email marketing with lowest click-to-open rates: Tuesday (13.5%)
To come up with these statistics, Campaign Monitor analyzed over 100 billion emails sent globally between January and December 2020
You can use this information to test your sending times and find out what is the perfect time to send emails to your specific audience.
Email Marketing Best Practices: 6 Ways to Improve Your Email Marketing Performance
Send Email on the Highest Performing Days
You already know the best days to send marketing emails, as well as the worst, and that you should test your sending times to find out what is the perfect time to send emails to your specific audience. So, when you find which days your audience engages the most with your emails, then those are your highest-performing days when you have to send your emails.
Segment Your List – Send the Right Message to the Right Audience
Sending the same message to your entire email list may work from time to time, but if you want to generate sales email list segmentation is the way to go.
Email list segmentation is a technique that email marketers use to divide their subscribers into smaller segments based on set criteria such as location, purchase history, interest, gender, income, education, employment, and more.
Email segmentation is used as a tactic to deliver more relevant content to your email subscribers. You want your email marketing campaign to deliver the right message to the right people at the right time and this is what makes email segmentation a must.
Make Sure Your Emails Are Mobile Friendly
IBM’s 1028 Marketing Benchmark Report found that up to 60% of email opens will occur on mobile devices, depending on the industry.
That means that regardless of your industry, a lot of your subscribers will open and view your emails from their mobile devices. For this reason, you need to create mobile-first or responsive designs for their emails.
Here are a couple of things to keep in mind:
- Keep your subject lines short – desktop inboxes display about 60 characters of an email subject line, while mobile devices show only around 30 characters. So, it is good to keep your email subject lines short and position the most important phrase of your subject line in the beginning.
- Use pre-header text – pre-header text is the first line of copy in your email. It is extremely useful when it comes down to mobile-friendly emails as is supports the subject line, providing context to attract your subscribers to open your email.
- Use a single-column template – do not confuse your readers and keep your email template simple and easy to navigate. Use short paragraphs, bullet lists, etc.
- Use images wisely – beautiful and high-resolution images can add so much to your email, but not all mobile devices display images by default, so they can also ruin your formatting. Stick to using smaller images that reduce load times and bandwidth.
- CTA – display a CTA button that is at least 44 x 44 pixels, to ensure maximum engagement and clickability.
- Test, test, test – before you send your email to your email list, make sure it looks and works the way you intended by tasting it across multiple devices.
Have Your Email Come From a Person Instead of Generic Email
Personalization is one of the best email marketing best practices. Having your email coming from a person instead of a generic email helps build a relationship with your subscribers. People want to receive emails and interact with other people and not mailboxes.
An interesting fact is that studies have shown that trusting the sender is the single most important factor in whether an email is opened or not.
Your “from’’ name and email address have to be recognizable to your subscribers, like your company name for example.
Have a Compelling Subject Line
The main goal of your email subject line is to compel your subscribers to open your email and read it. The best subject lines communicate the promise of value. Your email subject line must convince your subscribers that the email that you are sending them contains information that will be of value to them or their business.
In fact, those that don’t accurately tell what you are going to find inside are often reported as spam.
Here are some tips on how to write compelling subject lines:
- Keep it short
- Use a recognizable sender name
- Use personalization tokens
- Use numbers
- Convey urgency
- Ask questions
- Positions the most important words/ phrase at the beginning
- Capitalize the most important word
- Use emojis
- A/B test your email subject lines
Have a Clear CTA
And last, but not least of our email marketing best practices is having a clear and compelling call to action (CTA). A CTA is a phrase that is used to tell the subscriber what action to take – learn more, buy now, start a free trial, etc.
The CTA is usually in the form of a button because buttons are eye-catching and clean.
To create a powerful email CTA, you should first define your goal, then write your copy and finally design your CTA button. A successful CTA is more than a bright button with a catchy text that functions independently, but instead, a CTA that works is part of the entire copy of your email. Every element of your email contributes to making your CTA work and drive better conversions.
Now It’s Your Turn
Email marketing is not rocket science, you just have to do it right. Knowing how to measure the effectiveness of your email marketing campaigns, being aware of the email marketing best practices, and finding the best days to send marketing emails will help you skyrocket your overall marketing strategy.
Now it’s your turn. Go ahead and check your email marketing performance right now. How effective is your email marketing? How will you apply what you have learned from this article to your own campaigns?Tags: analytics, email marketing, how to, kpi dashboard, marketing kpis Categories: How To