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2021-04-14 22:00:00 Media Heroes

4 Email Marketing Metrics That Matter—Get Your Emails Read

Alistair Roberts
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In 1971, pioneering American computer programmer Ray Tomlinson sent the first ever email, introducing a technology that would transform how we communicate with each other. Today, it’s estimated that almost 300 billion emails are sent every day,1 connecting people from every continent of our swirling blue marble.

For businesses, email remains one of the most effective ways to market to customers. According to Forbes, people check their email around 15 times a day on average, which provides incredible opportunities if you know how to craft effective marketing emails, and measure your efforts.

In this article, we’ll explore the most critical email marketing metrics for you to measure, so that you can truly understand how your campaigns are performing.

What are your goals?

Before we jump into the metrics, we need to talk about goals. Most business endeavours need a strategy of some kind, which outlines your goals, processes, resources, and how to measure success. Email marketing is no exception—you need to outline your goals before you start sending emails, so that you can effectively measure your email marketing success, and whether they’re helping you to achieve your wider business goals.

For email marketing campaigns, some common goals include:

  • Generating leads and sales
  • Growing the brand
  • Turning customers into advocates
  • Improving customer retention

These goals might be achieved by sending marketing emails that contain product or service promotions, useful content (such as blogs), news updates, social media promotions, or a mixture of all.

The most important email marketing metrics

1. Open rate

hubspot open rate

Open rate in HubSpot

Your open rate is the percentage of people who opened your email. If you send an email to 100 people and it’s opened by 25 of them, your open rate is 25% (which is a decent score across most industries).

Open rate reveals a couple of important things:

  • How enticing your email subject is—when a new email appears in your inbox, the first thing you see is the subject line. If the subject is intriguing and arouses curiosity, you’re probably going to click on it. This is especially important when receiving an email from a company who is trying to sell or promote something.
  • The relevancy of your email to your audience—if your email is something that is relevant and valuable to your audience, they’re much more likely to open it. As you start to understand which of your audience are engaging with which types of emails (e.g. promotional, blog updates, etc.), you can improve your open rates by segmenting the lists into different types, and sending the content most appropriate to them.

When analysing your open rate for an email, you’ll need to look at a few things:

    • The average for your industry—email open rates differ by industry, so it’s a good idea to get a baseline for yours (check out Mailchimp and Campaign Monitor’s industry benchmarks).
    • How it compares to open rates for other emails with the same audience—if you’re sending your email campaigns to the same list of people every time, you can compare open rates between them to see which are performing better.
    • Which way your open rates are trending—if your open rates are trending upwards, your emails are likely to be relevant (and probably useful) to your audience. You might also find that open rates correlate with your number of subscribers—when your emails are no longer suitable, people unsubscribe. But when they’re hitting the mark, you’ll see more subscribers.

2. CTR

Click-through rate (CTR) is the percentage of people who clicked on a link in your email, out of those who opened it. It’s calculated by dividing the number of opens by clicks, and tells you how relevant and engaging your email is, as well as the effectiveness of its design. 

As with open rates, CTR varies by industry, so it’s important to know your industry’s benchmark. If your email has a good click-through rate, you’re doing a good job at nudging your audience towards an action, which can lead to an ultimate goal of a new sale, blog subscription, or something else important to your business. 

If you have a high open rate but a low CTR, you should work on refining the content and design of your email, to encourage people to make that all important click. Conversely, if you have a low open rate but a high CTR, you can generate more clicks by making your email’s subject more enticing.

3. Goal conversion rate

goals conversions in google analytics

Goal conversions in Google Analytics

Every marketing campaign is attempting to gently prod its audience towards goals. For an email campaign that is trying to turn customers into advocates with useful blog content, the goal might be to encourage a social share, with a view to create more referrals for the business. In this case, whenever a customer has shared one of your posts on a social platform after receiving it through an email, the goal has been completed. A simpler example is sending a product promo to your email subscribers, which if relevant and enticing, may lead directly to a sale.

Rather than just tracking the number of goals completed, it’s more valuable to track your goal conversion rate—the number of goals that have been completed based on the number of people the email has been sent to. This is calculated with the following formula: (goal conversions / delivered emails) x 100. For example, if you’ve sent your email to 1,000 people and 10 have completed your desired goal, your goal conversion rate is 1% (10 goals / 1000 emails). 

By measuring goal conversion rate, you can identify which of your emails have performed the best, and unearth a formula that works for you.

4. ROI

If the primary goal of your email marketing campaign is to generate more sales, ROI is the most important thing for you to measure, as it reveals the profitability of the campaign.

You can calculate email marketing ROI with the following formula: ((sales - investment) / investment) x 100. For example, if an email marketing campaign has generated $1,000 worth of sales, and cost $250 for your company to produce (staff labour, software costs, etc.), then the calculation is ((1000 - 250) / 250) x 100, which comes to 300%. This means that the email marketing campaign is producing a 300% return, and should be continued.

If the goal of your email marketing campaign is something other than generating sales, instead of measuring ROI (which is incredibly difficult), something more suitable should be measured instead. For example, for campaigns designed to:

    • Grow your brand—track your social followers, social engagement, email subscribers, and website traffic.
    • Turn customers into advocates—track referrals, online reviews, social engagement, and customer lifetime value
    • Improve customer retention—track repeat sales, time between purchases, and customer lifetime value

Other metrics

These metrics are a less direct measurement of business performance, but they still allow you to identify the successes and failures of your email marketing campaigns, and make improvements where needed.

List growth rate

List growth rate is the speed at which your subscriber list is growing. For campaigns designed to grow your brand, this is a critical monthly metric to measure, as it tells you exactly how quickly your email audience is growing.

List growth rate can be calculated with the following formula: ((number of new subscribers) - (number of unsubscribes) / number of emails in your list) x 100. For example, if you acquired 10 new subscribers in the last month, 1 unsubscribe, and have 200 emails in your list, the calculation is ((10) - (1) / 200) x 100), which comes to 4.5%. This means your list is growing at a rate of 4.5% each month.

As with open rates, CTR, and goal conversions, your list growth rate can tell you whether you’re producing emails that are resonating with your target audience. The higher your list growth rate, the more compelling and engaging your emails (and any content associated with them).

Unsubscribes

Bounces, unsubscribes, and spam reports in HubSpot

Bounces, unsubscribes, and spam reports in HubSpot

It’s perfectly normal for emails to generate a certain number of unsubscribes—people’s circumstances and preferences change, so they may not want to receive any more of your emails. This keeps your email subscriber list up-to-date and relevant.

On the other hand, a high unsubscribe rate can indicate a poor quality or irrelevant email, which should be reviewed. A healthy unsubscribe rate is around 0.5%, so if your emails are consistently breaching that benchmark, you may want to review your strategy.

Also, if you’ve just started sending emails to your list for the first time, you can expect a much higher unsubscribe rate than usual, because it isn’t clear whether the people on your list want to hear from you. This will settle down over time, when you have a list of people who want to receive your emails.

Email bounce rate

In the world of emails, bounce rate is the percentage of emails that couldn’t be delivered. There’s two types of bounces—soft bounces, which may be a temporary issue such as the user’s inbox being full, and hard bounces, which are the result of an invalid or closed email address.

Bounce rate is important to track because it can affect how many of your emails get through to your audience. If you consistently send emails with high bounce rates, email clients may start to see you as a spammer, and reject your emails (even if they’re genuine). HubSpot recommends trying to keep your bounce rate under 2%,2 and to always remove email addresses that have hard bounced.

Spam reports

As with bounce rates, spam reports are important to track because they affect your email deliverability. Get enough spam reports and you’ll see fewer and fewer of your emails being delivered. This is also an incentive to send emails that are genuinely valuable to the people in your list.

References
How Many Emails Does The Average Person Receive Per Day?, Campaign Monitor
Ginny Mineo, 2014, The Difference Between Hard Bounces and Soft Bounces [FAQs], Hubspot
Jacinda Santora, 2019, 10 Proven Ways to Reduce Email Unsubscribe Rates, OptinMonster

 

Want to know more about measuring your digital marketing performance? Check out our comprehensive guide to Every Digital Marketing Metric You Need for your business.

Topics: Marketing

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