In every area of marketing you need to use metrics to gauge your success. This holds true also for email marketing. In this post we compiled a list of the most common metrics in the business so as to make you aware of which they are and how you can use them to your advantage.
Following are the 5 most common email marketing metrics, their definition and a small example of how to calculate them:
- Bounce Rate
The “bounce rate” represents the percentage of the emails that we weren’t able to deliver. It is calculated by dividing the number of emails that weren’t delivered by the total number of emails we originally sent.Example: We sent 100 emails but 20 bounced because those email addresses didn’t exist. So our bounce rate would be: 20 / 100 * 100 = 20%This term can be further subdivided into hard and soft bounces. A hard bounce is when we weren’t able to deliver the email because the address to which we sent it is not valid or doesn’t exist. A soft bounce occurs when the address to which we sent the email does exist but for some reason we could not deliver the email (email server was offline, inbox full, etc).
- Click Through Rate
The “clickthrough rate” is a represented as a percentage and is calculated by dividing the amount of email recipients that clicked any of the links of your email and the total amount of delivered emails. Notice that we also take into account emails that were delivered but not opened.Example: We sent 2000 emails and 120 persons clicked a link on them, so our clickthrough rate is: 120 / 2000 * 100 = 6%
- Conversion Rate
This is a percentage that represents the amount of recipients that clicked on any link of our email and completed the desired action (ex: downloading a product or registering to our newsletter). It is calculated by dividing the amount of people that completed an action by the total amount of delivered emails.Example: We sent 1200 emails announcing our new app and 100 persons downloaded the app, so our conversion rate is: 100 / 1200 * 100 = 8.33%
- List Growth Rate
This metric is a percentage that represents the amount of email recipients who opened a specific email. It is calculated by dividing the amount of opens by the amount of delivered emails. This metric would be very useful if it wasn’t so difficult to measure exactly when a person has opened an email since normally we track the opened status of an email by using special images that when get loaded mark the email as opened; the problem with this is that many persons have image blocking enabled in their email client so even if they opened the email we wouldn’t know it. However, this is still a very common metric in the business.Example: We sent an email to our client list which comprises 1400 addresses of which 230 opened the email. In this case our open rate would be: 230 / 1400 * 100 = 16.43%
- Overall ROI
This is one of the most important and common metrics in Marketing. ROI stands for “Return On Investment” and it is a percentage that represents exactly what it’s name suggests. To calculate it you remove from the amount of total sales made the amount we invested in this campaign and divide all this by the amount we invested in this campaign (yes, you read that correctly).Example: We invested 500$ in our email campaign. When the campaign finished we saw that the campaign generated 1000$ of income, so our ROI for this campaign would be: (1000 – 500) / 500 * 100 = 100%
Question: Do you agree with our list of most important metrics? Did we leave anyone out?
Question 2: Do you use any of these? If so, have they proven useful?
Article written by Andrea Tupini