Email marketing metrics you need to know
Email marketing is a powerful tool for companies to reach and connect with their target audience. It’s important to measure your success and analyze the effectiveness of your email campaigns to increase your return on investment (ROI).
According to a survey, only 51% of marketing professionals said they were confident in their company’s ability to measure the ROI of their email marketing. So it’s important to be aware of the email marketing metrics you need to know and track. These metrics provide valuable insights into how your contacts are engaging with your campaign and can help you identify areas for improvement for future campaigns.
Let’s explore the email marketing metrics you need to know and how to use them to improve the effectiveness of your campaigns.
What is a metric in marketing
Marketing metrics and KPIs are essential tools used to evaluate the performance of your email campaigns. These insights give an accurate analysis of customer behavior and how your recipients interact with your emails. Additionally, metrics are trackable and data-driven, so you can monitor progress and fine-tune your strategy to improve your email campaigns.
Email marketing metrics you should track
To measure the success of your email campaigns, you should track several metrics. These metrics include:
Click-through rate (CTR)
The click-through rate (CTR) is the percentage of people who clicked on a link within your email out of the total number of emails sent. It’s an important metric because it helps you understand the performance of your campaigns and content.
CTOR only includes the actions of those who have opened your email. In short, it only measures the performance of your content.
CTR is calculated by dividing the number of clicks your ad or link receives by the total number of times it has been shown or viewed. CTR is shown as a percentage.
A low CTR means an ad or link is not targeting the right audience, while a high CTR means your content is engaging and relevant.
Our Global benchmark report revealed that CTR has declined by 15% to 1.4% meaning marketers have to pay more attention to creating engaging content. To improve your CTR, consider using clear and prominent call-to-action (CTA) buttons, improving your email design, and personalizing content.
The click-to-open rate (CTOR) is a metric that shows the percentage of unique clicks and opens for an email campaign. By comparing the number of clicks to the number of emails sent and opened, you can see how engaging and compelling the content is.
CTOR is calculated by dividing the number of unique clicks by the number of unique opens. Similar to CTR, CTOR is a percentage.
This year at Dotdigital, we have seen a notable 46% decrease in CTOR across all regions around the globe. By employing targeted email campaigns tailored to specific segments within your contact list, you can enhance your CTOR and engagement with your audience. This approach allows for more personalized and relevant content, increasing the likelihood of generating clicks and driving desired actions from your recipients.
Email open rate
The open rate is the percentage of people who opened your email out of the total number of emails sent. A high open rate means that your subject line and email content are relevant to your audience.
At Dotdigital, we have observed a global average email open rate of 31%. This reflects the effectiveness of our partners using our platform to capture recipients’ attention via email. However, it’s important to note that tracking open rates has become complicated with the introduction of Mail Privacy Protection (MPP), which prevents senders from seeing if and when recipients open their emails.
MPP works by having a bot open all emails as soon as they arrive in the recipient’s inbox and hides IP addresses, making it difficult to link open rates to other online activity or accurately determine the recipient’s location. So, trying to measure email engagement from the number of opens is increasingly unreliable.
If you’re wanting to improve your open rate, consider personalizing your subject lines and experimenting with different types of content.
The bounce rate is the percentage of emails that were undeliverable and returned to the sender.
There are two types of bounces: hard bounces and soft bounces. Hard bounces happen when an email address is invalid or no longer exists, while soft bounces happen when there’s a temporary issue, like a full inbox.
A high bounce rate can negatively impact your email deliverability and reputation. To keep your bounce rate low, it’s important to make sure your contact list is up-to-date.
The conversion rate is the percentage of people who took a desired action after clicking on a link within your email. This could be filling out a form, signing up for a newsletter, purchasing a product, or downloading your content.
This rate is calculated by analyzing how many people clicked on the link and then completed the specific action. A high conversion rate indicates that your email content and CTA were persuasive, effective, and relevant to your audience.
To improve your conversion rate, consider optimizing your landing pages and testing discounts and offers.
Customer lifetime value (CLV)
The customer lifetime value (CLV) is a calculation of the total value an email subscriber brings to your business over the entire duration of your relationship with them. Using this metric, you can determine the lifetime value of your subscribers as well as how much money you can expect from them.
To calculate CLV, you’ll need to know the average purchase value, the average purchase frequency, and the average customer lifespan. Once you have these metrics, you can use the following formula:
CLV = (Average Purchase Value x Average Purchase Frequency x Customer Lifespan)
This information can help you make informed decisions about how much you are willing to spend to acquire new subscribers, how often you should email your subscribers, and what types of products or services to offer them. By optimizing your email campaigns to increase CLV, you can increase the overall ROI of your company.
Return on investment (ROI)
The return on investment (ROI) is an important email marketing metric that measures the revenue generated by an email campaign compared to its cost, including the time and resources spent creating and sending emails.
To calculate the ROI of your email marketing campaigns, you’ll need to know the total revenue generated from your emails and the total cost of your email marketing campaign. Once you have these metrics, you can use the following formula:
ROI = (Total Revenue – Total Cost) / Total Cost
A positive ROI indicates a profitable email marketing campaign, while a negative ROI suggests a need to adjust your strategy. Tracking ROI helps identify the most effective tactics, and by continually monitoring it, you can make data-driven decisions to maximize revenue and profitability.
Dotdigital global benchmark report 2023
Monitoring your email performance metrics is crucial to the success of your campaigns. By regularly tracking and analyzing these metrics, you can optimize your email content, improve engagement, drive conversions, and boost ROI.
Be sure to read our Global benchmark report for 2023. It offers valuable insights into best practices for email marketing. Don’t miss this chance to improve your email campaigns.