There are a lot of factors to consider in order to get the email marketing strategy for your e-commerce business right. From the best email automation platforms to hyper-segmentation and hyper-personalization to creating unique email designs, you have to make key decisions at every step to make your emails more effective and engaging. However, you cannot fully optimize your campaigns unless you can analyze the results of your email marketing initiatives vis-à-vis your business goals.
Before you get down to planning your next campaign, dial back a little, and reflect on the goals of your email marketing initiatives. Only then can you zero-in on the right goals to track to assess your progress.
Which Email Marketing Metrics Should You Track?
As email marketing becomes more versatile and dynamic, the spectrum of metrics that reflect its effectiveness is also continually growing. However, keeping track of dozens of metrics at once yields little to no value if they’re not aligned with your immediate and distant business goals. This brings us to an important question – how to decide which email marketing metrics to track?
First and foremost, you can start by sifting out KPIs that have consistently proven impactful in the fulfillment of your business goals. Understand that metrics and KPIs are not essentially the same thing. For instance, open rates of your emails is a popular metric to track. However, qualified leads generated from the opened emails is a KPI. By narrowing down your focus to specifics, you can objectively see which metrics matter the most to your business objectives.
The next important thing to consider is the extent to which a change in a chosen metric would impact your business. If it’s not relevant to your bottom line, it may well not be worth tracking. Another yardstick is to assess how improving a particular metric will contribute to your email marketing strategy. And also, whether improving a metric will automatically help improve others. Metrics don’t operate in isolation and are largely interconnected.
Choosing the right ones to track and improve can create a domino effect, uplifting other key metrics, and transforming the effectiveness of your marketing initiatives.
Top 7 Metrics Every Ecommerce Business Should Track
While it’s true that the choice of metrics to track is specific to every business’s goals and vision for itself, there are some that you just cannot leave out. Here is a rundown on 7 such email marketing metrics that are crucial for every e-commerce business:
1. Open Rates
Image Source: HubSpot
Open rate refers to the percentage of recipients who opened your emails. The average open rate for the e-commerce or retail sector is pegged between 15.68% and 23%. Where your marketing initiative falls on this range depends on the robustness of your subject line and contact list among other variables. While it is one of the most crucial email marketing metrics to track, it is also the most misleading. An email is considered ‘opened’ only if the images embedded in the email body are downloaded. Many users, today, tend to have image-blocking enabled on their accounts. Besides, if the images are placed too low in the email body, they may not get rendered at all. This means that not all emails that opened actually contribute to your open rate.
Even so, it can be extremely valuable as a comparative metric when other variables can be controlled. For instance, you can use open rates to assess the effectiveness of your subject lines by comparing the results for different campaigns sent to the same list of recipients within a short span of time.
2. Click-through Rate (CTR)
Given that 32% of US consumers reportedly acted on a call-to-action included in emails, the click-through rate is a valuable metric to track. CTR tells you how many recipients clicked on at least one link embedded in your email. Since the whole purpose of email marketing is to get your subscribers to follow through on your CTA, a high CTR is considered the hallmark of an effective campaign.
However, this metric can fluctuate greatly depending on factors such as the content, segmentation, and industry vertical. So what qualifies as a good CTR then? Bear in mind that CTR is typically much lower than open rates, with an average rate of 2.01% for the e-commerce sector.
You can optimize this metric by placing links at the most appropriate places throughout the email body and making your CTA buttons eye-catching and inviting.
3. Email Forwarding and Sharing
As per a recent report, 81% of purchasing decisions made by a consumer are influenced by friends’ recommendations. So, if you can get your subscribers to not just click on your links but also share your emails with others, you can capitalize on the ROI of this already lucrative digital channel like never before. That’s why email forwarding and sharing is becoming the metric to keep an eye out for, especially for e-commerce businesses.
However, this is also one of the most challenging metrics to deliver on.
4. Revenue Per Email
You may already be well-versed with the low cost and high ROI of emails. You spend between $0.012 to $0.008 per email and stand to earn up to $42 for every $1 invested in return. While this ROI is eye-catching and lucrative, it gives you an overview of your total return on investment. By tracking revenue per email, you can analyze the performance of individual emails. This, in turn, helps you ascertain which emails are performing the best and which ones are bringing down your overall ROI.
This insight can prove extremely beneficial in weeding out practices and elements that are failing to make a mark. Thereby, further optimizing the returns of your email marketing campaigns.
5. Revenue Per Subscriber
Revenue per subscriber is a crucial metric to track, as it offers a near unparalleled microscopic look at the bottom line of your email marketing initiatives. It is also one of the hardest to measure, quantify, and track, as there are myriad variables at play. But you can get a pretty accurate measure by factoring in average cost per click and conversion rate. Let’s say, the conversion rate for your lead generation landing page is 20% and the average cost per click is $0.50, it means you generate one email subscriber for every 5 clicks. The cost to get each subscriber is $2.50. If your value per subscriber is $2.80, the average revenue per subscriber is $0.30.
This is just a broad formula that needs to be adjusted as per overhead and processes specific to your business. Sure, calculating revenue per subscriber can sound like a hassle but it can prove to be an invaluable asset for assessing the effectiveness of your email list building practices.
6. Mobile Opens
Today, 46% of emails are opened on mobiles. So, it’s not hard to see why tracking this metric is non-negotiable for the success of any email marketing initiative. However, the mobile open rates vary as per the day and time. Your emails may have high mobile opens during weekends, evenings and early morning whereas emails sent during business hours have a higher likelihood of being accessed on desktops. Establishing benchmarks for different devices and testing send times can help you ascertain if your subscribers are converting better from their smartphones or desktops. If the mobile open rate is higher than that for desktops, you can adjust the time for sending out emails to capitalize on the likelihood of them being opened on mobiles.
7. Conversion Rate
Conversion rate refers to the percentage of recipients who not just clicked on the link embedded in the email but also followed through on the desired action – be it filling out a form, leaving a review, or making a purchase. Since, the conversion rate is directly linked to your CTA, which in turn is linked to your c, it becomes a crucial metric for assessing how successful you’ve been in achieving those goals.
The average email conversion rate is 15.11% in 2020. If you are clocking conversions close to or just short of this average, you can count it as a respectable outcome. To measure conversion rate accurately, you must integrate the email platform you’re using with your web analytics.
The Bottom Line
The bottom line is that you need to be smart about the metrics you track. Choose the ones that offer you a microscopic view of the performance of individual emails, email list health, and results vis-à-vis goals. As long as you don’t lose sight of these, you’ll remain on track to create effective email marketing campaigns.