Published on March 11, 2014
There’s a lot to love about Email Marketing. One of the best things about it (and one of the many reasons that Email kicks digital-marketing butt) is that it’s so measurable.
Even if you consider potential challenges that affect the accuracy of some email metrics, like issues relating to image display (including the all- important invisible “open” pixel), deliverability or tracking on mobile devices, email marketing is still a lot more measurable (and oftentimes more effective) than other marketing channels.
So what are the key email metrics you should get to know “intimately” to better understand the performance of your email marketing efforts? Well they’re a mostly loveable bunch! And here they are:
An email “open” is registered when an image of an invisible pixel within an email (personalized for each recipient) is loaded. Total opens include every instance of a recipient opening an email, so if one subscriber opens the same email five times, it is reported as five “opens” instead of one. The Open Rate is calculated by dividing the total number of emails opened (for a given campaign) by the net delivered emails for that campaign, expressed as a percentage of the total email opens. “Some people question my credibility because it‟s hard to know if I‟m “legit” a lot of the time. Also, even if I register an “open”, it doesn‟t necessarily mean that the email was actually viewed. So only hook up with me if you‟re not a stickler for the little details ;-)” Name: Open Rate About me:
A Unique Open refers to just one instance of a recipient opening an email, so if one subscriber opens the same email five times, it is reported only as a single “open” instead of five. The Unique Open Rate indicates the number of unique individuals who viewed an email campaign at least once. The Unique Open Rate is calculated by dividing the total number of unique opens by the net delivered emails for the campaign, expressed as a percentage of total unique email opens. “I‟ve been told that I‟m a lot more straightforward than Open Rate. Hey, I may not perfect be either (who is??) but I guess that being unique has it‟s charms!” Name: Unique Open Rate About me:
Every time a subscriber clicks on a link, button or image within an email, a click is recorded. The Click-through Rate (CTR) is calculated by dividing the total number of clicks (on all the links in the campaign) by the net delivered emails for the campaign, expressed a percentage. Often, the unsubscribe link is excluded from this calculation to help get a more accurate idea of the campaign’s engagement level, rather than skewing it with the negative implications of the unsubscribe link. “I‟ve been told that I‟m a bit of a tease because I like to repeat some of my encounters, but I can‟t help it! I like to explore all possibilities to the fullest. Some people don‟t mind it, but most seem to go for Mr Unique CTR in the end. Urghhh!” Name: Click-through Rate Nickname: CTR About me:
Name: Unique Click-through Rate Nickname: Unique CTR About me: Unique Clicks measures the number of unique individuals who clicked on at least one link within an email for a given email campaign. The Unique Click-through Rate is calculated by dividing the number of unique individuals who click on one or more links in an email by the total number of emails delivered, expressed as a percentage. “When I find „The One‟, there‟s no going back for me! And I‟m pretty consistent that way ;-)”
The Click-to-open rate, or CTOR, measures how many of the recipients who opened a particular email clicked on links within that email. It is calculated by dividing the number of unique clicks by the number of unique opens, expressed as a percentage. The CTOR is essentially an indicator of the effectiveness of an email campaign – or in other words, how successful the content was in engaging the recipients – and is therefore one of the most important email metrics to measure. The CTOR can vary depending on the type of email, its timing, and other factors, so establishing a benchmark can be tricky. The idea is, however, to aim for as high a CTOR as possible, and if you can see that it’s slipping over time, you should examine all the potential causes – but most importantly the quality and relevance of your content – in an effort to improve engagement. Name: Click to Open Rate Nickname: CTOR About me:
The bounce rate indicates the total number of emails that could not be delivered to the recipient’s inbox for a given email campaign. A high bounce rate can be a sign that your list contains too many invalid email addresses and needs a good “clean” to restore its integrity. There are two kinds of bounces: Soft bounces – where messages fail to be delivered due to a temporary problem, like when the recipient’s mailbox is full, the server is down, or the message exceeds the size limit set by the recipient’s or ESP, and hard bounces – where messages are permanently rejected due to an invalid email address or because sender’s server has been blocked by the recipient’s server. Too many hard bounces can reflect badly on your sender reputation so you should “clean” your list regularly (remove invalid email addresses) to avoid internet service providers (ISPs) suspecting that you might be a spammer. Name: Bounce Rate About me:
Abuse complaints happen when recipients click the “mark as spam” button in their email clients. That usually means that they don’t remember signing up to your email program, so it’s always a good idea to place a reminder (usually in the footer) about how they came to be on your mailing list (like signing up on your website, for example). Also, make sure that your “From” line clearly identifies you. If recipients did not opt-in to your list by choice, then they have every right to complain about you, so it’s never a good idea to add people to your mailing list without their permission. The marked-as-spam rate is calculated by dividing the number of subscribers who reported your email as spam, by the number of emails delivered. “I really hate it when total strangers act like we‟ve been dating for ages. Weirdos!” Name: Marked-as-SPAM Rate Nickname: Abuse Complaints About me:
An Unsubscribe is registered when someone clicks on the “unsubscribe” link in an email and opts out of your mailing list. The Unsubscribe Rate refers to the proportion of recipients who unsubscribed for a given email campaign, expressed as a percentage of emails delivered. A high unsubscribe rate indicates that your emails are unwelcome by recipients either because the content you’re sending is irrelevant or not useful to them, or because they were not added to your mailing list using a permission-based process and are therefore opting out. Either way, if your unsubscribe rate is high, you need to act quickly to identify the cause and address it. “If a relationship isn‟t working, I‟d rather end it. What‟s the point of dragging it out if I‟ve lost interest? It‟s a lose-lose for everyone involved! Name: Unsubscribe Rate About me:
The deliverability rate (or “delivery rate”) is the percentage of emails that were actually delivered to recipients’ inboxes, calculated by subtracting total bounces from the total number of emails sent and then dividing that number by the total of emails sent. Ideally you should aim for a delivery rate of 95% or higher and make sure that it doesn’t decline over time. If it does, it could be a sign that your mailing list is due for a “clean-up” by removing any invalid email addresses that are causing messages to bounce. If you experience an unusually low deliverability rate for a particular campaign, it could be because ISPs or firewalls flagged it as spam, so you should review the subject line and content of the email to make sure that nothing in it can be construed as “Spammy” and consider re-sending it to the bounced addresses. “I like to connect with everybody because you never know which connection might lead to the beginning of a beautiful relationship!” Name: Deliverability Rate About me:
The percentage of recipients who clicked on the “forward to a friend” button or on a “share” button to post the email content to a social network. Obviously the higher the rate, the stronger the validation that your content is hitting its mark! “If I like what I see, I usually can‟t wait to tell people all about it. Woo hoo!” Name: Email Forwarding/Sharing Rate About me:
The conversion rate aims to measure the success of a campaign and the effectiveness of its call-to-action. A conversion occurs when the email’s intended action is performed by the recipient. Examples of conversions include registrations, filling out forms, sweepstakes entries, downloads, and of course, purchases. The Email Conversion Rate is calculated by dividing the number of conversions by the number of net emails delivered, expressed as a percentage. Most conversions don’t take place in the email itself but on the call-to-action’s destination page, so the conversion rate cannot always be attributed to the email alone. A high conversion rate means that your offer was compelling and relevant and that the page on which the conversion took place was conducive to a favourable result, and a low conversion rate means the opposite, so make sure that you optimize the entire funnel for best results. Don’t forget to create a unique tracking URLs for your email links so that you can attribute conversions to the relevant email campaigns. Name: Conversion Rate About me:
The email revenue which is generated as a direct result of a particular campaign is calculated by dividing the total revenue generated from the campaign by the number of emails sent to determine the revenue per email sent. This metric is very important if you generate a lot of direct sales from your email campaigns and it usually requires integration between your ESP and your ecommerce platform. If you don’t have this type of integration you can also create unique tracking URLs for your email links and use web analytics to track the source of the purchase in order to attribute the revenue generated to the relevant email campaign. “Some people think that I‟m a little materialistic, but I don‟t care. I like to milk my relationships for all they‟re worth.” Name: About me: Email Revenue
The List Growth Rate is a measure of how fast your email list is growing. It is calculated by subtracting opt- outs and hard bounces from the number of new email subscribers gained over a set period of time and then, dividing that number by the list size as it was at the beginning of that period. All mailing lists experience churn over time for a variety of reasons but mostly due to people opting out of your email list, or email addresses “going bad” (becoming invalid due to people changing jobs, switching ESPs, closing email accounts etc.). Churn is natural, so to maintain a healthy email program you must also aim to increase opt-ins to your mailing list. The list growth rate is an indicator of how successful you are at attracting new subscribers and retaining your existing ones. “I‟m really into meeting new people. What can I say? I have a of love to go around ;-)” Name: About me: List Growth Rate
Now that you’ve met the most popular email metrics, how do you think they’d all get along in a friendly little get-together?
Let’s see, shall we?
Of these 1,000 people: • 970 emails are delivered (and 30 are not) • 400 people open the email • 8 people mark your email as “spam” and 10 people unsubscribe • 80 people forward the email to a friend or “share” it on a social network. As a result, 60 new people subscribe to your newsletter. Let’s say that you create an email (with one clickable call-to-action) promoting a $10 coupon, and you send it out to 1,000 people. Of the 400 people that open your email: • Some come back later and open it again, a total of 150 times • 250 people click on your call-to-action button • Some come back later and click on it again, a total of 100 times • 150 people go ahead and purchase the coupon
Now let‟s see our email metrics in action!
Open Rate 550 Total Opens (400 unique opens + 150 repeat opens) ÷ 970 delivered emails = 0.567 So your Open Rate is 56.7% 400 unique opens ÷ 970 delivered emails = 0.412 So your Unique Open Rate is 41.2% 970 delivered emails ÷ 1,000 sent emails = 0.97 So your Delivery Rate is 97%
350 Total Clicks (250 unique clicks + 100 repeat clicks) ÷ 970 delivered emails = 0.361 So your Click-through Rate (CTR) is 36.1% 250 individuals who clicked on at least one link (or in this case the only link) inside their email at least once ÷ 970 delivered emails = 0.258 So your Unique Click-through Rate (Unique CTR) is 25.8% 250 unique clicks ÷ 400 emails opened = 0.625 So the Unique Click-to-Open Rate (Unique CTOR) is 62.5%
30 undelivered emails ÷ 1,000 total emails sent = 0.03 So your Bounce Rate is 3% 8 people mark your email as spam ÷ 970 delivered emails = 0.008 So your Mark-as-Spam Rate is 0.08% 10 unsubscribes ÷ 970 delivered emails = 0.01 So your Mark-as-Spam Rate is 1%
150 coupons purchased @ $10 each ($1,500) ÷ 970 delivered emails = 0.155 So your Conversion Rate is 15.5% & your Email Revenue is $1.55 ($1,500 ÷ 970) per email sent 60 new subscribers - 40 subscribers lost (30 bounces + 10 unsubscribes) ÷ 1,000 subscribers in your original list = 0.02 So your List Growth Rate is 2% 30 people forward the email and 50 people “share” its content on social networks. You could calculate the “forward” and “share” rates separately but for now, we’ll combine them: (80 total forwards & shares) ÷ 970 delivered emails = 0.082 So your Forward/Share Rate is 8.2%
So there you go, now you can spot the popular email metrics and understand their game. But Email also has an “X Factor” that no metric can measure because whether a subscriber interacts with an email or not, it also has certain immeasurable powers.
For one thing, if you keep sending great, relevant content that your subscribers enjoy, they will look forward to opening and engaging with your emails, which will in turn strengthen their loyalty to your brand. You can’t “measure” the affinity that your subscribers develop for your brand over time as a result of enjoying and appreciating your emails.
Also, Email can keep your brand top-of-mind even during spells in which your subscribers don’t interact with it at all, which is especially important if your competitors are also vying for their attention in the Inbox. You can’t measure how “aware” your subscribers are of your brand as a result of receiving your emails, even when they’re not actively engaging with them.
But the bottom line is that regular analysis of your email campaigns is super-important to help you gauge whether or not you’re doing a good job, and luckily, there are plenty of metrics that you can refer to in your ongoing quest to optimize the performance of your email program.
If you use email wisely, are mindful of the most current best practices, and committed to not only meeting your subscribers expectations from your email program but exceeding them, then your email performance should reflect the effort that you put into it.
This presentation was created by Noya Lizor, Head Honcho at The Best of Email, a hub for showcasing standout emails by email marketers who are “getting email right”. Visit www.thebestofemail.com to learn more about:
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