Success with email marketing entails more than just sending out emails to your subscribers. Certain metrics must be tracked on a regular basis to improve your email marketing performance, ensuring a consistent return on your investment and identifying areas for improvement.
- Which email marketing KPIs should you be tracking?
- How do you set realistic expectations for your email marketing metrics?
- What strategies should you rely on for measuring and analyzing email marketing KPIs?
Dive into this post to find the email marketing metrics answers you’ve been searching for.
Importance of Tracking Email Marketing KPIs
There are many benefits to tracking your email marketing KPIs regularly, including:
Gauging Your Email Marketing Campaign’s Effectiveness
First and foremost, tracking your email marketing KPIs helps you gauge their overall effectiveness. It helps email marketers get a better understanding of how subscribers are engaging with email content.
If, as an email marketer, you’re not tracking your KPIs regularly, you won’t know whether or not your content is resonating with your subscribers. This, in turn, can negatively affect your email campaign investment.
Identifying Areas for Improvement in Your Email Marketing Campaigns
Tracking your campaign’s KPIs will help you determine what works and doesn’t. Then, you can use those insights to make some improvements in your marketing emails. Not to mention that you can use them for future email campaigns.
For example, you may be providing the best email content in your niche, but your subject lines may be lacking in terms of engagement. Analyzing the open rate KPI of your email campaigns can bring such a problem to light so you can address it.
Making Data-Driven Decisions for Your Email Marketing Campaigns
The most notable benefit of tracking your email marketing KPIs is that it allows you to make strategic and well-informed business decisions that align with your initiatives and objectives using real-time email marketing insights and data.
There are better approaches than making business decisions based on emotion and intuition. Instead, having a data-driven mindset is the key to maximizing the success of your marketing campaign, and it entails KPI tracking and analysis.
The 8 Most Important Email Marketing KPIs to Track
While there are several email marketing metrics that you can track and optimize, the following eight are by far the most significant:
1. Click-Through Rate
The first email marketing metric you should be tracking is your click-through rate (CTR), which represents the percentage of email recipients who clicked on any of the links in a given email you sent out.
Tracking your click-through rate enables you to assess the performance of each individual email you send. It provides you with direct insight into how your subscribers engage with your email content.
Additionally, you can use this metric in email marketing A/B tests to figure out new ways to increase the number of clicks in your emails.
A good click-through rate can vary significantly depending on your industry. With that in mind, the average click-through rate across different industries is 2.91%, according to MailChimp.
There are many ways to optimize your click-through rate, including adding social sharing icons to your template, personalizing your subject lines, using fewer CTAs, and adding visuals and alt texts in your emails.
Formula: Click-Through Rate = (Total Clicks or Unique clicks / Number of delivered emails) x 100
2. Bounce Rate
Bounce rate is a metric that represents the number of emails that weren’t delivered successfully to a recipient’s inbox. Bounced emails can result from temporary problems or an invalid email address.
If it’s a temporary problem, like an issue with the recipient’s server, we refer to it as a “soft bounce.” If the problem is an invalid, non-existent, or closed email address, we refer to it as a “hard bounce.”
Soft bounces are easy to remedy. If it’s, in fact, a problem with the recipient’s server, the email will hit their inbox as soon as the server problem is resolved.
Hard bounces, on the other hand, have no fix. This is exactly where tracking your bounce rate comes in handy, as it allows you to detect hard bounces and remove their corresponding email addresses from your list.
By removing hard bounces from your list, you reduce your bounce rate. And as you probably know, internet service providers use bounce rates to indicate an email sender’s reputation. So if you have too many hard bounces, your ISP might view you as a spammer.
Formula: Bounce Rate = (Number of Bounced Emails / Number of Emails Sent) x 100
3. Conversion Rate
Your campaign’s conversion rate is one of the most important metrics to track because it indicates the percentage of recipients who completed a desired action through your emails.
The desired action can be anything from buying a product or subscribing to a service to filling out a form or downloading an ebook. As long as the recipient proceeds with your offer, it counts as a conversion.
Another reason why your conversion rate is vital to track is that it’s directly tied to your call to action (CTA); therefore, it’s bound to the overall objective of your email marketing efforts.
Formula: Conversion Rate = (Number of Recipients Who Complete Your Offer / Number of Deliveries) x 100
4. Open Rate
When you think about the most critical email marketing KPIs to track, your open rate is probably the first metric that comes to mind. It’s the percentage of email recipients who open your emails.
Your open rate is definitely important, but we wouldn’t say it’s the most vital metric to track, as it’s not the most accurate representation of your campaign’s performance.
For an email to count as opened, the recipient must receive all of its content, including images. The problem is that many email users tend to have the image-blocking feature enabled on their email clients.
On that account, even if the user opens your email, which includes images, the email won’t count as opened since the images didn’t load on the user’s end.
Having said all of that, you shouldn’t spend too much time trying to optimize your open rate. Instead, it would be best if you focused on reducing your bounce rate and increasing your click-through rate.
Formula: Open Rate = (Emails Opened / (Emails Sent – Bounces)) x 100
5. List Growth Rate
As the name suggests, this KPI represents the rate at which your email list is growing. This, in turn, makes it a representation of how your business is growing.
A high list growth rate indicates that your content is of high relevance. If it weren’t of high relevance, you’d be losing subscribers at a faster rate than the rate at which you’re gaining subscribers.
Your list growth rate can be a tricky metric, though, since not all new subscribers will be high-quality prospects. In other words, not all new subscribers will improve your engagement rate by clicking your links, responding to your emails, converting to buyers, etc.
Be that as it may, it’s still imperative to keep growing your list of subscribers at a healthy rate to balance out the natural email database decay that happens at a rate of 22.5% per year.
Formula: List Growth Rate = ((Number of New Users – Number of Unsubscribers) / Number of Recipients) x 100
6. Unsubscribe Rate
The unsubscribe rate is a representation of the percentage of recipients who unsubscribe from receiving your emails. Despite being an important metric to keep an eye on, it’s not the most accurate representation of your list’s health.
Just because you’re not losing subscribers doesn’t mean your email list is healthy. After all, most subscribers who aren’t interested in your emails will simply stop opening them rather than go through the unsubscribe process.
Instead of relying on your unsubscribe rate as a measurement of your email list’s health, you should be relying on your conversion and click-through rates, as they’re more accurate when it comes to assessing engagement.
So, why is it essential to track your unsubscribe rate? Because it helps you calculate your list growth rate.
Formula: Unsubscribe Rate = (Total Number of Unsubscribers / Total Number of Deliveries) x 100
7. Overall ROI
Your overall ROI is a sales-driven KPI representing the investment return. So it’s essentially a representation of your email campaign’s cost-effectiveness.
According to statistics, a typical email marketing ROI is a $36 return on every $1 you spend, making email marketing one of the most profitable digital marketing channels.
Taking that into consideration, you should be doing your best to increase your campaign’s overall ROI, which translates to more deliverability, brand awareness, conversions, and revenue.
Formula: Overall ROI = ((Gains – Costs) / Costs) x 100
8. Sharing/Forwarding Rate
As implied, this KPI represents the percentage of recipients who shared your content on social media or forwarded it to other email users. It’s an important metric to track because it’s associated with generating new contacts.
We highly recommend keeping tabs on your sharing/forwarding rates so that you can determine the type of content that your recipients tend to share or forward and make more of it.
Formula: Sharing/Forwarding Rate = (Number of Shares or Forwards / Number of Deliveries) x 100
Tips for Setting Realistic KPI Goals for Your Email Marketing Campaigns
To set realistic KPI expectations for your business, there are a few points to consider:
- Consider Your Email Campaign Goals – First and foremost, you need to think about why you’re using emails as a marketing channel in the first place. What are you trying to improve? For some, it can be brand awareness, while for others, it can be traffic and leads. Find out more about email marketing goals here.
- Optimize the Right KPIs – Having determined the goal of your email marketing campaign, you can then proceed to choose the proper KPIs to track, which are the ones that align with your goals. For instance, if you want to increase your website’s traffic via email marketing, aim to increase your click-through rate.
- Aim for Long-Term Success in Your Email Marketing Campaign – Not every optimization effort you make will affect your ROI directly. So, it would be best if you focused on long-term success by encouraging engagement and building relationships with your subscribers.
- Track Your Email Campaign KPIs Regularly – Your email marketing strategy is bound to evolve over time, and so will your KPI goals. On that note, you need to track your progress on a regular basis and optimize it along the way to ensure consistent results.
Measuring and Analyzing the Email Marketing KPIs of Your Email Marketing Campaign with Email Analytics
There are quite a few ways you can go about measuring and analyzing your email marketing KPIs, including:
- ESP Analytics – Every email service provider (ESP) provides basic analytics that you can use to check KPIs such as open rate and click-through rate.
- Google Analytics – ESP analytics can be too basic for some email marketers. If you want more detailed insights into your email campaign’s performance, Google Analytics is the way to go.
- A/B Testing – A/B testing is vital for comparing different email versions and templates to see which ones achieve better results. For example, you can test which subject line performs the best.
Tracking the correct KPIs is crucial for the success of any email marketing campaign. By regularly monitoring and analyzing key performance indicators, businesses can optimize their campaigns and achieve their marketing goals.
Hopefully, with the information shared in this post, you’ll be able to pinpoint the correct KPIs to track for your business and set realistic KPI expectations that align with your industry.