According to Litmus, for every dollar spent on email marketing, it generates $36! In fact, the Return on Investment (ROI) generated by email is higher than the ROI generated by any other digital marketing channel.
Clearly, email is the mainspring in your brand clock. And Key Performance Indicators (KPIs) is how you know if it is working fine. So, in order for your brand to keep ticking on in 2023, here are nine email marketing KPIs you must track.
1. Clickthrough Rate (CTR)
The clickthrough rate is the percentage of email recipients who clicked on the link(s) in your email content. As per Mailchimp, a 2.91% CTR is considered good across industries.
Now, why should you need to know the CTR?
Being a marketer, you want to know how each one of your intended recipients reacted to your email. Are they even remotely interested in your brand? Are they showing signs of engaging with your content over time? Is your email “nudging” your recipients to perform an action? The CTR answers these questions for you.
Indeed, using the CTR, you can evaluate the performance of the email content, the degree of email fatigue, the propriety of link placements, the use of media types, etc.
Here’s the formula for calculating the CTR.
2. Conversion Rate
The percentage of email recipients who complete a desired action makes for the conversion rate. It could be anything from downloading a free ebook to visiting the product page for purchasing purposes. Below is the formula for conversion rate calculation.
A good email conversion rate varies across businesses. According to Klaviyo, food and beverage companies generate the highest conversion rate at 0.19%, whereas sporting goods companies and electronics-related businesses are the least converting.
It also depends on the type of email sent, size of the organization, location of the company, etc.
Now, why is it important? Simple! As a marketer, you want to know if your lead generation and sales strategies are working or not. All actionable data is contrastive, including the conversion rate. It puts things in perspective.
At its simplest, you want to know how many people are buying your product, how many are aware of it, and how many believe that it is the right choice for them. What’s more, the conversion rate tells you where you must direct your focus.
So, if you boast a good conversion rate, you may want to shift your focus toward advertising. Likewise, if your website is not converting, you want to pull the branding and marketing levers.
3. Email Deliverability Rate
Email deliverability rate is the percentage of emails that got delivered to your recipients’ inboxes. As per MailModo’s recent study, 70-100% is the average deliverability rate across industries.
Note that the email deliverability rate is NOT the same as the email delivery rate. The delivery rate indicates how many of your emails were delivered, whereas the deliverability rate tells you how many of your emails successfully skirted the spam folder and got delivered to the recipient’s inbox.
So, the deliverability rate gives you a deeper understanding of the trajectory of your email. Ultimately, a higher delivery rate is a no-win if the deliverability rate is lower.
4. Email Open Rate
How many of your subscribers actually opened your email? That’s what the open rate reveals.
Campaign Monitor states that a good open rate is somewhere between 17-28%. But the figure may vary dramatically from one industry to another.
Below is the formula for calculating the email open rate.
At its simplest, the open rate tells you if at all your email is worthy of attention. You don’t want your targets to overlook your email, scroll up, and get busy with the more urgent messages.
Besides, after 24 hours, the chance of your email getting noticed plummets to below 1%. Hence the need to pay attention to the open rate.
A note of caution though: technically speaking, an email is considered “opened” if the recipient also receives the images embedded in the particular email content. If, however, a recipient has blocked pictorial content, an email, even when opened, will not be considered so. As a result, the open rate you see may not always be accurate.
Don’t worry, the open rate is still one of the important email marketing success metrics for the reasons stated above. Moreover, if you want to compare the open rates of the present and the previous week, you can rely on the metric as the variables are not usually affected by the personalized changes made by the recipient.
5. Email Bounce Rate
Bounce rate is the percentage of emails that have failed to reach your subscribers.
A hard bounce occurs when the intended recipient email address is non-existent or the recipient email server has blocked delivery. A soft bounce, on the other hand, points to a temporary, fixable delivery issue.
Here’s how you calculate the bounce rate.
Speaking of email campaign metrics, the bounce rate might not at first blush seem urgent, given that both soft and hard bounces are typically the result of something beyond your immediate control.
However, too many hard bounces can result in your being blocked by an ISP as part of the latter’s effort to circumvent spammers. It doesn’t take long for your email address to go “bad”.
Therefore, if you see an increase in the bounce rate, make sure to identify and troubleshoot any underlying issues in your email. The bounce rate should not exceed 2%.
6. Email Spam Rate
The spam rate is the percentage of emails that have landed in your subscribers’ spam folder, instead of their inboxes. It is inarguably one of the most notorious KPIs for email marketing.
If most of your brand emails end up in spam folders, your account may get blocked. Besides, if your spam score is high, it indicates that the targeted customers are simply not interested in your emails. Needless to say, that’s embarrassingly bad tidings for your brand!
So, you want to keep tabs on the spam rate of your emails. And here’s how you do it.
If your account registers a high spam complaint rate, it will take at least two months, if not more, to fix it. In the meantime, the domain reputation, along with the brand image, have already been dealt a major blow.
7. Email List Growth Rate
Has your email subscriber list grown since you kicked off your campaign? Or has your outreach program come to naught? The list growth rate, one of the most important email marketing KPIs, can tell you. Here’s the formula for calculating it.
As a marketer, your goal is to widen your reach and grow your audience. You want to establish yourself among the industry thought leaders.
Now, consider your goal in light of the fact that the email marketing list naturally dwindles at the rate of 22.7% every year. So, if your email list has 500 recipients in January, it will, in the absence of regular growth analyses, come down to 390 by December of the same year.
Bums you out, right?
Growing your email list is therefore a necessity if you want to grow the size of the list over the years.
8. Email Sharing Rate/ Forwarding Rate
The sharing/forwarding rate is the percentage of email recipients who either shared your email content across social media or forwarded the same to their personal contacts.
Email marketers, focused solely on open and spam rates, often tend to underestimate the significance of the sharing/forwarding rate. And yet, this is how your brand can reach out to new potential subscribers.
“Focus on growing your list all of the time as newer subscribers are more engaged, adding to healthier open rates and ROI,” urges Karl Murray, the founder of Hustle & Praise, a digital creative agency based in Ireland.
So, the ‘share’ and the ‘forward to a friend’ button is a great way to beef up your database. After all, if you know your content is helpful, you want to use it to help more people.
Here’s how you calculate the sharing/forwarding rate.
9. Email ROI
According to a Statista report, 73% of company respondents stated email marketing to be an excellent digital marketing channel for ROI.
The ROI measures the overall success of your email campaign. While there are several ways to calculate the ROI, here’s the most elementary one.
The ROI ultimately tells you how effective your marketing/advertising/promotion strategies over a period of time have been. This includes, but is not limited to, the following:
- How has your email campaign affected your revenue generation this year compared to the last?
- How have your customers reacted to ROI-focused campaign changes?
Email is used by 4 billion people across the world. That’s almost half the global population. From open rate and bounce rate to spam rate and ROI, your metrics will determine if your business is actually cashing in on the massive potential of email. Whether your campaign needs a slight tweak or a major overhaul, you only get to know it by the metrics you choose to track.