- Get into email inboxes so your message can at least be seen—that means swimming the moats the email service providers build to keep out low-quality emails.
- Once seen, get opened—because you write compelling subject lines or your email subscribers know and love your messages from past experience.
- Once opened, convince readers to take an action—click to your website, download a coupon, pick up the phone, come in to the store.
- Make money on your email program, when all is read and done.
OK, that’s four — it’s a four-athlon, but who’s counting? The point is you have to win each challenge to advance to the next.
How do you know when you’re winning? Depends on your goals, maybe driving new business with an offer email, driving repeat business with a reminder email, or staying top of mind with a monthly email newsletter. These four key metrics will help you keep score:
Get Into the Inbox – Delivery Rate
How many of the email addresses on your list actually receive your message? The rate should be 95% or more. A downward trend says that your list has too many inactive addresses (or “hard bounces”) or that email service providers are beginning to treat you like a low quality sender. Eliminate those dead email addresses and take other steps to avoid the spammer label now.
(By the way, email vendors strongly discourage you from buying email lists because of the risks of bad addresses. Your list should be all “opt-in”, in other words, customers gave you permission to send.)
Get Opened – Open Rate
Of the messages delivered, how many were opened? As a hard number, it’s unreliable because, for technical reasons in how opens are tallied, as well as the fat fingers of users, many opens get counted that aren’t really intentional. But as a relative number to compare among your own email sends, open rate tells you how well your subject lines perform (particularly if you’re A/B testing one subject line against another for the same message) and over time, you can see whether your subscribers are losing or gaining interest in your messages. According to Silverpop’s 2014 email benchmarking report, the median for open rates is 39%.
Take an Action – Click to Open Rate
Of those who opened, what percentage clicked on a link in the message? According to Silverpop, the median rate is 10%. If you’re looking for one measure of the effectiveness of your message, there you go. But email marketing can win you a range of other measureable actions. Your email vendor can put a unique tracking number on an email user (as can Google Analytics) so you can record their actions on your site, for instance, filling out a form, or viewing a store locator page. If you tie it all together with a customer relationship management system, you can track through to final sales and come up with a conversion rate, which is the numbers of purchases or other actions divided by emails delivered.
As with any of the metrics on this list, you should slice and dice by subscriber segment (new customers, high value customers, etc.) for more accurate targeting of your email campaigns.
Make Money – Revenue or Profitability
Email is pretty cheap: A penny or less to send a message and email vendors save you the cost of design by supplying ready-made templates. So you’re off to a good head start on the “investment” part of “return on investment”. The “return” may be tougher to track for a local business: A customer may walk in after seeing but not clicking on your message. But that’s where a CRM system can help. Some ways to figure return on investment or profitability of email campaigns (hat tip to the Occam’s Razor blog):
- Profitability = (revenue generated – campaign cost – cost of goods or services sold) / # of emails sent. Great if you have a firm handle on your business costs.
- Average Revenue per Email Sent = total revenue / # of emails sent. Great for a campaign with a tightly defined goal (like download a coupon).
Actually, the list of metrics for email goes on and on—that’s the beauty, it’s so measureable, unlike say, a triathlon where you only have a timer. You can, however, wear a swimsuit and rubber swim cap while you check your email stats, if it makes you feel like a winner.