Are you sending emails for your business simply because you know you should? Are they converting? Do you know how to tell if they’re working for your company?
Emails are an important part of your digital marketing strategy! Your email marketing Key Performance Indicators, or KPIs, are an easy way to measure how many recipients read your emails, make purchases, enjoy your email content, and more. Your KPIs serve as a roadmap and help you to determine if you’re meeting your goals.
WHY EMAIL MARKETING IS IMPORTANT
Email marketing helps your company to grow and is often an important factor in gaining new leads for your company. Emails are used for lead generation (85%), sales (84%), lead nurturing (78%), and customer retention (74%).
With those kinds of numbers, it’s impossible to say that email marketing doesn’t work or won’t help your company. Maybe you’re not seeing the sales that you’re hoping for yet, but tracking your KPIs will help!
WHAT IS A KPI AND WHY DO I NEED IT?
Your KPIs are important tools for benchmarking your success and understanding exactly what happens when you click “send” on an email campaign. In 2022, 33.3 billion emails are expected to be sent and received each day. That’s a whole lot of emails. You may be thinking, “if that many emails are sent, how do I know if people are reading mine, and why would they?”
Your KPIs are your answer. Email Key Performance Indicators allow you to measure how many people are reading your emails, what links are being clicked, what kind of content your audience prefers, and what types of emails they like to receive, and you can A/B test content, subject lines, and more.
EMAIL KPIS TO TRACK
Let’s get into the nitty-gritty details of it. If you work with a marketing email provider like Mailchimp, Klaviyo, or Constant Contact, many of these KPI insights will be provided to you through the software, but it’s important to know what the data means and how it may affect your goals.
Your email delivery rate tells you how many of the email addresses that you intended to get your email campaign actually received it. Although you sent the email to your full email list, every recipient may not see it in their inbox. A number of factors can play into this that we’ll get into in your bounce rate. Your goal is to get your delivery rate as close to 100% as possible.
When an email doesn’t make it to its intended inbox, that’s called a “bounce.” Imagine you have a bouncy ball that you’re trying to throw through an open window to your friend inside. If you throw it through the window, that email is delivered.
If you miss, that’s a bounce. You may miss the window for many reasons: the wind blew the ball off course; there was a screen in the window that you didn’t see; your friend wasn’t there to catch it; or maybe you’ve just got bad aim (No judgment—it happens!). The same is true for your emails. They may bounce for multiple reasons: a typo in the email address or getting sent to the “spam” folder are the most common culprits. But there could also be a network error, or the inbox could be full.
Monitor this rate closely to learn why your emails aren’t getting through to their intended recipients. If there are a lot of blocks, you may need to change up your subject lines or authenticate your URL.
This is the first KPI on your list that tells you something about your audience. Your email open rate tells how many people opened the email after seeing it in their inbox. Some of the questions that can be answered by your email open rate are:
- Was your subject line compelling?
- Was the recipient familiar with the sender’s email address? (For example, a client may see an email come through from our company as “Root & Roam” or as “Stacy, Founder of Root & Roam,” depending on the digital strategy behind our campaign. If you’re testing this out, an A/B test can show you if your audience recognizes a person from your brand or the brand alone.)
Your click-through rate is the percentage of recipients who opened your email and proceeded to click a link in your email. You can use this as a good way to tell if the email contains copy, graphics, or discounts that your audience resonates with! Generally speaking, the higher your click-through rate, the more your audience likes the content in your email. If they’re not clicking your links, try changing up what’s inside your email!
So now you know how many people are receiving your email, opening your email, and clicking through to your website. These are great insights, but you might find yourself thinking, “but are they actually buying from me?” That’s what your conversion rate will tell you! There are many integrations (Klaviyo and Shopify play together very well!) that will pull this data for you right into your email platform. Conversion as a sale is typical for an eCommerce website, but if you’re in a service industry, a conversion may look like an appointment booking, the length of a page view, redeeming a code, or something else. If there isn’t a native integration to keep track of your conversion, Google Analytics and Google URL builder can track this as well. The higher your conversion rate, the more conversions you’re getting.
REVENUE/REVENUE PER SUBSCRIBER
If you want to know exactly how much money you earned from an email campaign, this one’s for you. This will tell you the dollar amount (or associated dollar amount) your email brought to your business. Divide this by how many subscribers are on your email list to get an estimated value per person.
If you’re tracking conversions differently, like the number of appointments made, you can associate a dollar amount with this. For example, if each appointment made brings in approximately $X of revenue for your company, multiply the number of conversions with your approximate value to get your revenue estimate.
You’ll want to keep track of how many people are unsubscribing from your emails. If you find that one type of email is causing more recipients to unsubscribe, you can stop sending that type of content. A high unsubscribe rate signals to email providers, like Google, that the content is not something that should be sent. This can land your emails in spam folders or worse—get your domain blacklisted from sending emails at all.
Email marketing return on investment is high—and it’s an exciting metric to see! This metric shows how much revenue was generated for your company compared to how much it cost you to develop the email.
On average, email marketing has an ROI of $36 for every $1 spent.
If your ROI is lower than you’d like, consider heading back to your digital strategy for some updates, or, if it’s within budget, hire a graphic designer!
Knowing how often a subscriber engages with your company is important. With this info, you can “bucket” customers and send more targeted emails.
If they’re a high engagement customer, they open, read, click, and potentially purchase through a high number of your emails. Consider an “insider sale” or “loyalty program” for these customers.
If they’re a low-engagement customer, consider sending “win back” emails and/or removing them from your newsletter list.
With all these metrics and KPIs, you can make sure that your company is meeting its goals and making adjustments as needed. As you begin to track your email marketing KPIs, you’ll see a shift in the content, conversions, revenue, and ROI. You’ll see customer loyalty soar as they become more familiar with the brand and get the content that resonates with them.
If your email marketing campaigns and strategy need a boost, reach out to Root & Roam! We’re excited to help you develop something that helps build your company!