Over the past decade, there’s been a significant shift in marketing — or at least an evolution. Email marketing has become increasingly complicated, as well as leveraged. Today, your email metrics drive everything from customer acquisition to revenue. That’s why it’s important to understand your business’ key performance indicators (KPIs) that matter in email marketing.
In our experience as email marketing consultants in Dubai, we’ve come across many businesses who struggle to set up relevant and effective email metrics. Hence, this guide will demystify the most important KPIs that every company or business needs to be aware of, regardless of their email marketing channel (organic or paid newsletter, etc.)
Key Email Marketing Metrics
- Clickthrough Rate
It’s a percentage that represents the number of people who clicked on one, two or more links in your sent email. This is the most important KPI for email marketing, but it is also one of the most difficult to measure accurately.
Its calculated as: (Total clicks OR unique clicks ÷ Number of delivered emails) * 100. For an instance: We dispatched an email to a group of 1,000 individuals, resulting in 25 clicks overall, with 20 of those being distinct clicks. Our clickthrough rate is (25 ÷ 20) * 100 = 50%.
A high clickthrough rate indicates that your subject line or call-to-action was enticing enough to get people to click through and read your content. If you have a low clickthrough rate on one campaign, try changing up your subject line or other elements of the email before sending another one out.
2. Conversion Rate
The percentage of people who took the desired action after receiving your email e.g buying a product or filling out a lead generation form. It is determined by taking the count of conversions, dividing it by the total emails delivered, and then multiplying the result by 100. For example: If 10 out of 100 subscribers clicked through to make a purchase, then the conversion rate would be 1%
Its value depends on what you’re trying to accomplish with your email marketing campaign. If you’re trying to sell something or generate leads, then this is one of the most important KPIs you can track. But if your goal is to build relationships with customers or prospects over time, then it’s less important — especially if your emails are educational in nature.
3. Bounce Rate
This measures how many emails bounced back (i.e., were undeliverable) because of a technical issue with your list or email delivery service (i.e., wrong address format). The goal here should be to have zero bounces. Its calculation involves dividing the overall count of bounced emails by the quantity of sent emails and then multiplying the outcome by 100. In other words, if you sent 100 emails and 10 of them bounced, then your bounce rate would be 10%.
Bounce rate is a powerful metric that can tell you a lot about your email marketing strategy. But like any other KPI, it’s important to know how to use it properly. A high bounce rate means that people are opening your emails but not clicking on any links. If many people are opening your emails but not engaging with them, then chances are they aren’t interested in what you’re sending them. This could mean that your content isn’t relevant or compelling enough for them, or that it’s too long or boring. It could also mean that your subject line isn’t attracting the right audience.
4. Email Sharing/Forwarding Rate
The number of times an email is shared or forwarded. This is the percentage of your emails that are forwarded or shared across social media. You can see this as a total number or as a per-campaign value. The calculation is simple: (Number of clicks on a share and/or forward button ÷ Number of total delivered emails) * 100. An example is if you sent an email with 30,000 total recipients and 5,000 clicked the link to share it on Facebook, then the email sharing rate would be 10 percent ((5000 ÷ 30000) * 100) = 16.7%.
Email sharing and forwarding rates are two very important email marketing metrics. They measure how well your emails perform in terms of generating social shares. These two metrics help you gauge how engaged your subscribers are with your content and if they think it’s worth sharing with their network.
5. List Growth Rate
It’s the number of new subscribers to your list and shows how quickly your business is growing, and whether or not you are reaching new audiences. The higher the growth rate, the better. Its calculated like this: ([(Number of new subscribers) minus (Number of unsubscribes + email/spam complaints)] ÷ Total number of email addresses on your list]) * 100. An example is List Growth Rate = [(100) – (70)] / 1000 *100= 3%.
This is one of the most important KPIs because it measures how well you’re building relationships with your audience. It also gives you a sense of whether they are engaged with your emails or not. If you see a negative growth rate, that means people are unsubscribing and not opening your emails at all. This happens when you send too many promotional emails and don’t offer enough value to the subscriber base.
6. Open Rate
The open rate KPI measures the percentage of recipients who have opened the email. It’s a good way to measure how relevant your emails are to your audience and how well you’re targeting them. If you can consistently get a high open rate, it means that your content has been engaging enough to convince people to read it.
According to an email marketing consultancy in Dubai, “Email clients are set up differently, so there’s no one standard way of measuring opens. However, most email analytics software will report on total opens or unique opens for each campaign.” Some providers also track soft opens (when an email client displays an icon indicating that it has received an email without actually opening it).
Open rates aren’t the only thing that matters when it comes to measuring the success of your campaigns. While they do give you insight into whether or not your subscribers found their last email useful enough to open, they don’t tell you how many people made a purchase after opening an email or even if they clicked on any links within them.
7. Overall ROI
To measure the success of your email marketing campaigns, you need to know how much revenue each email generates. That’s why overall return on investment (ROI) is one of the most important metrics for evaluating your email campaign performance.
Overall ROI measures how much money you’ve made compared to how much you spent on sending emails. You’ll want to track this metric over time so that you can see how well your campaigns are performing and determine which ones are worth investing in further.
The formula for calculating overall ROI is [($ in additional sales made minus $ invested in the campaign) ÷ $ invested in the campaign] * 100. For example, if you spend $200 on an email marketing campaign and make $2400 in revenue, your overall ROI would be 1100% return on investment for the campaign
Overall ROI is a good indicator of how effective your email marketing strategy has been, but it’s not as useful as some other KPIs because it can be skewed by seasonal factors. For example, if you sell products that are only relevant during certain times of year (such as summer clothing), then one year with a high overall ROI doesn’t necessarily mean that your strategy is successful for all years.
8. Unsubscribe Rate
Unsubscribe rate is the percentage of users who have unsubscribed from your email list. The calculation entails dividing the quantity of unsubscribes by the total count of sent emails. The main reason for this calculation is that it helps marketers understand how well their lists are performing.
You can get an idea of how many people are interested in your content and products by looking at the open rate, but you won’t know whether they actually want to receive emails from you unless they subscribe to your list in the first place. If they don’t, then they’re unlikely to open any emails that you send them later on. The unsubscribe rate gives us a sense of how many people are interested in our content compared to how many people are simply not interested enough to stick around.
If a high percentage of your subscribers are choosing to unsubscribe, then your strategy may need some work. However, if you have a low unsubscribe rate but low open rates, it could mean that your subscribers are simply not interested in the content they receive from you.
Determining the Email Metrics to Monitor According to Your Objectives
This is how you can match your particular objective with essential metrics.
- Subscriber List Growth Rate
The number of new subscribers you’re adding to your list. This is a really important metric to track because it shows how well your email marketing strategy is working. If you have a large subscriber list and are adding a lot of new subscribers every month, that means you’re doing something right. You can use this metric to see what kind of content works best for your audience and what kind of offers they respond best to so that you can keep them coming back for more. Add calls-to-actions to attract more visitors such as more lead generation for digital agencies, more buyers for ecommerce shops and more shares of blog posts.
- Unengaged Subscribers
You’re sending emails to people who haven’t opened your emails in at least two months (or one year). Why? Because they’ve told you they’re not interested any longer by deleting or unsubscribing from your emails or by never opening them in the first place. This could also mean that they’re no longer engaged with your content and therefore don’t want to receive any more messages from you. Keep an eye on your unengaged subscribers and remove these types of recipients from your list. Because sending mails to unengaging people can hurt the deliverability of your email overall.
- Number of New (or Total) Leads Generated
The primary goal of your business and email marketing efforts is to generate new leads. If so, then tracking the number of new leads generated is a must. You can use this data to measure your overall performance and make sure that you’re meeting your sales team’s expectations. You can also see what types of content you should be sending out over time, so you can see what works best for generating new leads. A focus on leads will give you an idea of which campaigns are working best and which ones aren’t performing as well as expected.
- Lead-to-Customer Conversion Rate
When you decide to shift your focus towards the middle/bottom of your marketing funnel and your goal is to convert existing leads to sales and later loyal customers, then the lead-to-customer conversion rate is an important metric to track. This metric tells you how many leads become customers, and it’s a good way to measure the effectiveness of your campaigns. Provide email content that is related and relevant to your business and your product or service. Add calls-to-action such as get a free demo.
Metrics are The Anatomy of a Successful Email Marketing Campaign
By focusing on actionable KPIs, you will be able to confidently navigate the metrics in your email marketing and take concrete actions to improve the success of your campaigns. But it’s important to understand–and be able to measure–how your email efforts are contributing towards your campaign objectives.
Email analytics allow you to do this and help ensure that you’re not including email as a one-off tactic in your overall strategy. However, all of this data can be confusing and hard to navigate. Fortunately, this article is going to help you understand what each KPI means and how to apply them to your email marketing. And if you need guidance on the best email marketing practices from a professional, contact Infobahn lead generation agency in Dubai @ +971 4 285 3773 / WhatsApp 050 381 3221.