A strong email marketing campaign is one of the easiest and most cost-effective ways to keep in touch with your customers. In fact, a study performed by Litmus determined that an email generates $42 for every $1 spent, which is a 4,200% return on investment, making email marketing one of the most cost-effective marketing options available.
With email campaigns, you can send an email that will reach thousands of interested customers in just a few moments. However, after you set up your campaign and hit that send button, how do you know if your campaign is successful? In this blog post, we will go over some essential Email Marketing KPIs that can help your business measure the success of your next email marketing campaign.
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What is email marketing?
Email marketing is the lead generation branch of your digital marketing strategy that uses email to promote your brand, products, and services. Email marketing is a straightforward and effective way to connect with potential leads and nurture them into the conversion phase. Emails are also great when reconnecting with previous customers to keep the relationship alive and entice them back using extra offers and fresh content.
With global email marketing valued at $7.5 billion in 2020 and projections to increase to $17.9 billion by 2027, email marketing is still holding firm. In fact, today’s 4 billion daily email users are expected to climb to 4.6 billion by 2025. The growth of email users coupled with the potential return on investment – email marketing is a lead nurturing tactic that your business needs in its marketing toolbox.
Why measure your email marketing campaign success?
If you do not know where your email campaign started – how do you know if your overall campaign was successful? Without creating email marketing metrics that include initial benchmarks or setting up key performance indicators (KPIs), you will not be able to determine if your email marketing campaign is a success or a flop.
Setting up Email Marketing KPIs
Key performance indicators (KPIs) are defined as quantifiable measurements of a particular performance over time for a specific objective. KPIs provide specific goals for businesses to reach, milestones to hit, and quantifiable insights to let you know if the campaign is on track or missing the mark. While not all KPIs will work for your email campaign, there are some important KPIs that you should gauge as an indicator of success.
Some important Email Marketing KPIs you should use to measure are:
- Open Rates vs Inbox Placement Rate (IPR)
- Conversion Rates
- Click-through Rates
- Click-to-open Rates (CTO)
- Unsubscribe Rates
- Bounce Rates
Open rates vs inbox placement rate (IPR)
To measure these both, you must understand the difference between open and inbox placement rates (IPR).
An open rate is when your emails are opened (clicked on) by the recipient. The IPR is the percentage of your sent emails that went to their targeted inbox – instead of junk or spam.
For example, let’s say you have a list of 20,000 people that you want to send your emails. When you send out that list – this does not mean that 20,000 people now know about your campaign. Of that 20,000, many of those emails may not even make it into the right hands. Some emails may go into the recipient’s spam folder, others may have been blocked, and others may not ever reach the light of day.
This is the IPR.
IPR is the number of recipients that made it to the right spot and how many were opened. The metric that needs to be tracked is the correct number of emails that made it to the right recipient and what percentage of those emails were opened.
Bounce rates
Some people get the bounce rate of emails and websites confused since they both track different actions.
Looking at a website’s data, the bounce rate would indicate how long or short a customer visited a particular webpage or piece of content. With email, a bounce rate is if it made it into an inbox or not.
An email bounce rate can either be a “hard bounce” or a “soft bounce.” A hard bounce indicates that the email is no good, and it is bouncing back, unable to go to its destination. A soft bounce can be temporary, such as the server being down on the other end, or maybe the inbox is full.
If you are receiving a lot of bounce rates with your email campaigns, it may be time to reassess your list and update your customers.
Click-through rates (CTR)
A click-through rate is more than just if an email is opened – it’s how and where that email is open.
CTR offers more granular data that you can learn from. It’s where your customer clicked within your email that’s important. It’s how many times a customer clicked, where they clicked, and why they clicked.
If you track particular links in emails, you can see each link’s success and failures, and you can tweak emails as you go. CTRs offer you insight into what your customers find engaging within your email campaigns and what offers or information they want to click on.
Click-to-open rates (CTO)
As granular as you can get with CTR, CTO takes it a step further and helps businesses measure the effectiveness of their content.
The CTO metric is calculated by the number of unique clicks divided by the number of unique opens.
For example, if you sent out an email list with 100 names and 20 people clicked on a link within that email, you have about a 20% CTR. To determine the CTO of this same list, let’s say that those 20 people made 50 unique clicks within your content. That would make your CTO 20/50 or 40%.
This percentage is an indicator of how engaging your content is to your subscribers. If your overall content is appealing and attractive, your CTO will be higher because your readers will want to click through to learn more – if your content is stale and boring, your CTO will be lower, or they will not click on it anything at all.
Conversion rates
This is the goal of your campaign! However, it isn’t always about making money or selling a product.
A conversion rate can be any desired action your business wants a customer to take. That action could be simply opening up an email, downloading a piece of content, or even registering for a class.
The conversion is unique to a particular piece of content and is tracked through KPIs. It is the main goal that a business aims to achieve, and you cannot understand your conversions if you do not set up metrics to capture them.
Unsubscribe rates
An unsubscribe is just that – when someone does not want to subscribe to your list or your offerings anymore.
However, these customers at one point were interested in your content or product, so an unsubscribe list is an excellent way to determine ways to increase your conversions.
Do you notice a lot of unsubscribes lately? Has your content gotten stale? A significant increase in your unsubscribe amounts is a pretty good indicator that something is going wrong somewhere within your content stream.
Ask the professionals for help
Creating campaigns, setting up strategies, and using email marketing analytics are vital parts of a healthy business’s digital marketing strategy. With such a great ROI, email marketing should be utilized by every large or small business. If you are looking to increase your ROI and tap into email marketing campaigns but need help setting up email marketing KPIs – then SomneoX can help. Our team of experienced professionals can help you get those emails opened and get those conversions you need. To learn more about our services or to speak to our team, contact us today.