Did you know that 59% of marketers say email is their biggest source of ROI?
Despite all the attention to new channels, email marketing still represents a huge opportunity, and it's not going anywhere anytime soon.
If you're running email marketing campaigns for clients, you should also be showing them quantitative metrics that highlight both the performance and overall return on investment. In this guide, we'll discuss seven key performance indicators (KPIs) for email marketing that you should be tracking and sharing with clients as soon as possible.
1. Open Rate
The first email marketing KPI to share with clients is the open rate, which is the percentage of people that actually open a given email. With the sheer number of emails we all receive each day, getting people to actually open your emails is often easier said than done.
While opening an email is the first step towards taking a desired action, it should be noted that it is only a part of the equation and needs to be paired with other email metrics such as click-through rate and conversion rate to understand the success of a campaign. That said, open rate can be highly useful in helping optimize your email subject lines over time.
2. Click-through Rate (CTR)
Next, your clients will want to know whether or not their list is actually reading their marketing emails and taking action. After opening an email, the next key metric to monitor is its click-through rate (CTR).
The click-through rate is the percentage of people who open an email and click through to an attached link. Not to be confused with the conversion rate, it should be noted that the click-through rate doesn't take into consideration if the recipient actually followed through with the call to action (i.e. made a purchase).
Below you can see an example of tracking CTR within AgencyAnalytics from a demo MailChimp account, which includes the number of emails sent, open rate, click rate, unsubscribe rate, bounce rate, and the send time:
Click-through rate allows you to monitor who in your audience is actually engaging with your brand and email. With this information, you can now narrow down which emails driving action and which need improvement.
3. Unsubscribe Rate
How many times have you personally unsubscribed from a subscription? Chances are, plenty. There are many reasons why consumers discontinue their subscriptions with various companies, and these reasons are much the same for your email audience.
One of the most common reasons people unsubscribe is that they're receiving way too many emails. No one likes to constantly delete marketing emails. Thankfully, you're able to track the unsubscribe rate and fix it before it becomes a problem.
Typically, achieving an unsubscribe rate below 0.5% is considered acceptable for an email campaign. If you're going over that number, you should think about scaling back a bit and tweaking the content of your emails.
A few ways you can keep the unsubscribe rate down include:
- Look at how many emails you've sent out within your highest month of unsubscribes. If you're sending too many emails, you'll likely notice an increase in the unsubscribe rate.
- Consider what type of content you were sending within those emails. Were they too promotional? Was the information not relevant to your client's customer base?
- What was the tone of the emails? Did you excite the audience at all? A higher unsubscribe rate may indicate an engagement problem that can be fixed by changing the email's messaging.
In order to achieve these goals, A/B testing is another valuable technique to optimize email performance over time.
4. Bounce Rate
In the context of email marketing, bounce rate is defined as the percentage of emails that were not successfully delivered to recipients. This is one of the most frustrating aspects of email marketing, but it can affect how you're viewed in the eyes of email service providers and should be tracked closely. Too many bounced emails result in your emails looking like spam and should be avoided at all costs.
As highlighted in our article on Bounce Rate Tips:
There is no "good" bounce rate metric. This differs for every company and every type of business. The best you can do is monitor this rate to give yourself a benchmark, and then track your progress for better or worse.
There are two types of email bounce rates: soft and hard bounces.
Soft bounces occur when there's an issue with the recipient's mailbox. Maybe they have too many emails or their server is down. Typcially this won't affect anything on your end because you can simply resend the email without any problem.
Hard bounces are the ones that can negatively affect your email reputation and deliverability, but they can also be fixed on your end. Hard bounces occur when an email is sent to an invalid or non-existent email address.
Perhaps you entered the email address incorrectly. Or, the subscriber could have hit the wrong key when they were entering their own address. Things happen, but you can fix it by immediately removing these addresses from your email list. This way, you won't sacrifice your bounce rate. If you want to learn more about how to reduce your bounce rate, check out these 12 tips from OptinMonster.
5. Forward Rate
When it comes to email marketing, many clients want to know exactly how many times their content is being shared, which brings us to the forward rate.
So why is forward rate an important metric? You and your clients are always looking for more potential leads, and finding them isn't always easy. When your audience shares or forwards an email, this is a great indicator that the content is resonating with them and you're gaining new leads. This metric allows you to track which emails and content are the most popular, which can then be applied to your future email marketing strategies.
6. Conversion Rate
Conversion rate is undoubtedly one of the most important KPIs to monitor for your client since the whole point of a marketing email is to get the reader to take action.
In order to track conversions from email, you can create URLs that are specific to your email campaign links, and you're able to monitor who completed the task because of your email. This is known as UTM tracking, which you can learn more about in our guide on the subject here.
You can then go back to your Google Analytics report in AgencyAnalytics and click Channel > Email, which provides you with detailed information on your conversion rate, goal completions, goal value, and more:
7. Overall ROI
Finally, just like any other marketing channel, you want to show your clients exactly what the total revenue and overall ROI of their email marketing campaigns. In order to track total revenue of email in AgencyAnalytics, all you need to do is set up Goal Values in Google Analytics and then divide this by your email-related costs to get the ROI:
While email marketing can be one of the most profitable channels for marketers, it can also be one of the most challenging to master. In order to determine the exact return on email marketing and improve your results over time, you should invest time into tracking and monitoring these seven key metrics.
Adding these key performance indicators to your client reports and monitoring them on a regular basis will not only benefit your relationship with your client, but will also provide you with valuable data to optimize future campaigns.
If you want to automate the process of tracking and reporting on your results, check out our prebuilt email marketing report template here.