There are many different components that make up a successful email marketing campaign. From using gripping subject lines, to interesting content that’s personal to the reader. The problem is you could be sending out the best emails the world has ever seen, but if you aren’t tracking your Key Performance Indicators (KPIs), you will never know how well it performed. Not to mention, measuring whether the email helped you in achieving your marketing goal. Hence, why tracking is so important and every marketer should be doing it! If you’re not don’t worry, we’ve got your BAK…
Take a look at these 6 email marketing KPIs you can be monitoring to help optimise your campaigns!
What is CTR?
The first email marketing KPI on the list is CTR. This is the percentage of people that clicked on one or more links within your email. When researching which KPIs you should be measuring, CTR is most likely the first one you will come across. We consider this your day-to-day email marketing KPI. It allows you to easily track the performance of every single email you send. If people are clicking your links, they are interested in your brand and what you have to offer. For this reason, many people use CTR to measure the results of A/B testing.
How do you calculate CTR?
Total clicks ÷ Emails Delivered x 100 = CTR
Let’s put this into practice. If you sent out 150 emails and 35 people clicked on a link within your email, the calculation would be 35 ÷ 150 x 100. Meaning your CTR would be 23%. This would be incredible by the way, as the average CTR across all industries in 2018 was 4.19%. Time for email marketing KPI #2
What is conversion rate?
Conversion rate is the percentage of people that clicked on a link within your email and carried out the desired action. This could be anything from making a purchase, signing up to another of your mailing lists, or downloading a free ebook. If your target audience does something as a result of your call-to-action, it is classed as a conversion. This means that conversion rate is one of the most important KPIs for measuring whether or not you’re on the right track to achieving your campaign goal.
How do you calculate conversion rate?
Number of people who took the desired action ÷ Total number of emails sent x 100 = conversion rate
For example, imagine that you send 1000 emails, of those emails, 24 people carried out the desired action. The calculation would be; 24 ÷ 1000 x 100 = 2.4. Meaning your conversion rate would be 2.4%. Let’s move onto email marketing KPI #3…
What is bounce rate?
Bounce rate is the percentage of emails sent that couldn’t be delivered to the recipient’s inbox. There are two different types of bounce rates; soft and hard. In a nutshell, a soft bounce is a temporary issue, a hard bounce is a permanent problem that needs more attention. There are many reasons why bounces occur which we have explored in another post, but for now, let’s look at how you calculate this KPI.
How do you calculate bounce rate?
Total number of bounces (hard or soft) ÷ number of emails sent x 100 = bounce rate
So, if you attempted to send 500 emails but 5 of them were unable to be delivered the calculation would be; 5 ÷ 500 x 100. Therefore your bounce rate would be 1%.
List Growth Rate
What is list growth rate?
This one is pretty self-explanatory, the rate at which your email list is growing. As well as measuring call-to-action KPIs such as conversions and CTR, you also need to be measuring the growth and loss of subscribers on your mailing list. Obviously, the main goal is to grow your subscriber list in order to get your brand out there and increase your reach. However, this isn’t always the case and on average, email lists tend to decay at an astonishing rate of about 22.5% each year! For this reason, keeping track of your subscriber list is crucial in making sure your list is a healthy size.
How do you calculate list growth rate?
Number of new subscribers – Number of unsubscribed users ÷ Total amount of subscribers x 100 = list growth rate
Let’s put this into practice. So you have gained 200 subscribers, but 100 have unsubscribed and your mailing list contains 5000 email addresses in total. The calculation would be 200 – 100 ÷ 5000 x 100. This means your list growth rate for the time frame you have chosen to measure would be 2%.
What is share rate?
Share rate is simply the percentage people that share the contents of your email. This is a great KPI to measure as this is one way in which you can gain new subscribers and/or leads. Encourage your readers to share your content on social media to try and increase your brand awareness. But don’t go too over the top with your encouragement on the sharing side of things, begging for engagement isn’t a good look. Measuring your share rate also gives you a great indication to what your subscribers find useful. If you know what content your subscribers find useful and interesting, you can tailor your email marketing campaigns in the future.
How do you calculate share rate?
Number of clicks on the share button within your email ÷ Total number of emails delivered x 100 = share rate
Say, for example, you sent 1500 emails and from those recipients, 25 shared your content. The share rate calculation would be 25 ÷ 1500 x 100. Meaning your growth rate would be 1.6%. Let’s take a look at the final email marketing KPI. Well actually, this KPI is one you should be using for every aspect of your marketing efforts, not just email.
Return on Investment (ROI)
What is ROI?
This is how much return you have received as a result of your spend on email marketing. As with every aspect of your marketing, you should be calculating and tracking your ROI. This is arguably the most important KPI in this list, if not the most important KPI there is. If you know that you’re receiving a good return on the money you are spending, then you know you’re doing something right…
How do you calculate ROI?
Sales as a result of email marketing – Cost of email marketing ÷ Cost of email marketing x 100 = ROI
Queue our final example. If you spent $100 on your campaign but seen a $2000 return. First of all, you would jump for joy seeing a return of $2000! Secondly, you would do the calculation 2000 – 100 ÷ 100 x 100 to find that your ROI was a massive 1900%.
Although we have provided you with the calculations you need to do to work out each of these Key Performance Indicators, it’s unlikely you will actually need to work out most of these for yourself. See if you use any of the free email marketing software that we have introduced to you before, then they provide you with most of these KPIs anyway. So there’s no maths required *phew!
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