Sending out emails is a fantastic way to promote your business, but it won’t do you any good if you don’t learn how to track or optimize your campaigns. There are several ways to track the performance of emails and newsletters, including the use of metrics and key performance indicators (KPIs).
In fact, one of the best ways to improve your email marketing campaign is through tracking KPIs relevant to your business and niche.
What Is a KPI in Marketing?
KPIs are quantifiable aspects of a marketing campaign’s performance or progress that can be measured over a period. Depending on your goals, examples of marketing KPIs include clickthrough rate, bounce rate, and open rate. By analyzing these figures, you can see exactly which aspects of your campaign are working.
When used properly, an email KPI provides valuable insights into your email campaigns and identifies opportunities for improvement. Savvy businesspeople use these metrics to work to design more effective email marketing strategies and grow their subscriber list.
How to Track Email Marketing Analytics
Now that you understand what a KPI is, you will want to consider a few tips to make the most of tracking these metrics. After all, you can’t just choose marketing KPI examples to measure and leave the data alone. You need to know how to analyze and view the data in the context of your marketing goals.
To correctly interpret the data you get from your email marketing KPIs, you will need to keep the following considerations in mind.
Define Your Business’ Email Marketing Goals
Before you choose which email marketing KPIs to track, you need to define your goals for the email campaigns. This will help you determine what metrics you want to pay attention to.
For example, a campaign with the goal of driving revenue would focus on very different KPIs than a campaign that wants to boost brand awareness. In these marketing KPI examples, the goal of brand awareness would look for metrics like list growth, forward rate, and unsubscribes. Meanwhile, clickthroughs and conversions may be more relevant to businesses with specific goals of revenue growth.
Some common goals for email campaigns include generating word of mouth, driving engagement, reducing churn, building brand trust, boosting conversions, and reducing the time between signup and purchase. Remember that your goal can change from one campaign to the next.
Define Your Tracking Goals
Once you have your goals for the email marketing campaign, you can create more specific tracking goals. This goes beyond just saying you want to track your conversions or clickthroughs as in the marketing KPI examples.
Make a measurable goal so you can track your progress and whether you achieve it. For example, if you want to increase conversions, your goal could be “get X more conversions each month” or “increase conversions by X%.” The key is that the goals must be measurable.
Additionally, you want your goals to be realistic. Be ambitious, but temper that with realism. If your goal is out of reach, you may feel discouraged by your results.
Be Willing to Rethink and Restructure Campaigns
As with any other marketing campaign, be willing to change your email campaign if you aren’t reaching your goals. You should also be willing to reevaluate whether your goals are realistic and adjust them if necessary.
The first of these is more important, as that is the point of tracking email marketing metrics. Your metrics are there to let you know whether your current campaign is working. That, in turn, lets you adjust the campaign so you won’t waste time on strategies or structures that don’t work.
The 10 Most Important Email Marketing KPIs & Metrics
What email marketing KPIs and metrics should you measure? The following are all excellent options to consider.
1. Clickthrough Rate
Clickthrough rate or CTR refers to the percentage of people who have clicked at least one link in your email campaign. This figure tells you many insights about your emails, including the subject line and copy used.
You can calculate this KPI yourself. Divide the number of unique clicks by that of the delivered emails, and then multiply by 100. For example, if there are 300 clicks in 100,000 emails, the CTR is 3%.
Keep in mind that just because someone opens your email doesn’t mean they interacted with it. You want the recipients to follow through with an action. Therefore, this is an important measure of how engaging your emails are. Your goal should be a 4% CTR, and you want to maintain it for a quality email campaign. The industry average is about 2.91%.
To effectively track this email marketing metric, make sure your emails have offers, trackable links, and CTAs or call-to-actions that encourage conversion.
It’s a good idea to play around with different email marketing campaigns to see which ones perform the best. The CTR will also tell you more about which copy is more engaging and which ones are lackluster, something that is essential to your email marketing analysis. A high CTR confirms that you have compelling CTAs and an appealing, clear email design.
2. Conversion Rate
Conversion rate takes into consideration people that did more than click through your email. This number represents the percentage of people who followed your call to action. You can track how many people subscribed, booked a service, purchased a product, or completed another desired action. Your CTR will help you measure engagement, but your conversion rate lets you know if you are actually converting leads into customers.
This valuable email KPI tells you that you are getting closer to your business goals with your email marketing. The formula for getting this number is the same as above. You divide the number of subscribers completing the desired task by the total number of emails delivered, then multiply it by 100. This gives you your email conversion rate.
The average conversion rate for email marketing is about 2.3%. If yours isn’t as high as you would like, consider reevaluating the relevance of your content, your CTA, your personalization, and the value proposition.
Additionally, conversion rates tell you if your email marketing ROI is where you want it. When people click on links but don’t convert, you are less likely to produce revenue long-term. Knowing these email marketing metrics early on can help keep problems away.
3. Bounce Rate
The bounce rate accounts for the percentage of emails that are not able to be delivered to subscribers. Email providers keep track of bounce-backs for every email you send. This rate also influences whether an email provider will accept your emails in the future as well.
There are two types of bounced emails: hard and soft bounces. Hard bounces are typically from non-existent emails or invalid ones. These emails should be deleted ASAP because they will never be delivered. Additionally, your reputation among internet service providers can be hurt by undeleted hard bounces.
Soft bounces, however, are usually from temporary issues such as server trouble or a full inbox. In this case, the email is received but bounces back to the sender because of issues. You can resend, or in some cases, the server will even do it.
To get this percentage, you divide the number of soft bounces by the number of emails delivered. Multiply the resulting figure by 100.
Your bounce rate will help you determine any deep-rooted trouble and get it resolved before it becomes worse. The higher the bounce rates, the more likely you are to be thought of as a spammer. You want to keep this number at or below 2% to avoid that negative label.
Spam complaints also affect this metric through poor content, poor deliverability, poor sender reputation, and more. When you’re flagged as spam, you know your recipient is annoyed. Reduce the chance of this happening by having a double opt-in form.
4. List Growth Rate
This metric measures how fast your email list grows. You should remember that this growth doesn’t equal high-quality clients who engage and convert. That is a completely separate but equally important measure.
You want subscribers that are engaged and click through, eventually converting. You want them to read and respond to the emails you create.
That being said, you still want this KPI to report a positive figure, suggesting your list is growing regularly rather than losing subscribers. A negative list growth rate means it is time to reevaluate your email marketing strategy.
Some good ways to improve your list growth rate include promoting the email list on your website and social media. You can also offer something like a discount or freebie in exchange for subscribing. You may also want to experiment with using different content types.
5. Forwarding Rate
This rate discusses the social share rate and measures how often your email is shared. With this metric, you’ll be able to see if your email was forwarded or shared on a social media platform. Email frequency and email design contribute to this metric, too.
The data is gathered from the share button on the email campaign. You want your emails to be share-worthy to grow your email list. The forward rate is also an incredibly useful tool when it comes to determining what topics are the most useful and engaging for your audience.
Keep emails simple and easy to read, and make sure to stick to a consistent schedule. Look for emails with higher forward rates and then try to create more with similar email content. You can also combine A/B testing with evaluations of the forward rate to test out topics or formats.
6. Open Rate
Email open rate is one of the more common metrics in email marketing tracking. This tracks the number of subscribers who open your email. It helps in determining the power of your subject line as well as your email campaign. It also lets you determine which topics are most appealing to your target audience by comparing the open rates of various emails.
You should note an open is only registered if the images are received. If an image-blocker is enabled, your results will be unreliable. Additionally, Apple’s Mail Privacy Protection allows users to disable tracking email openings. This makes the metric even more unreliable.
For reference, the average open rate across marketing as a whole is 22.8%. A higher rate will always be better, as that indicates your audience is engaged and interested. If your rate is too low, you may need to confirm that you understand your audience. You may also need to rethink the timing of your emails.
7. Click to Open Rate
Once you have the open rate and the clickthrough rate, you can calculate the click-to-open rate (CTOR). This compares the number of people who open your emails to those who click any of the links in the email. So, the CTOR measures how many people who open your email go on to click a link in it.
This metric helps you evaluate the effectiveness of your CTA as well as the overall copy and design of your email. Across all industries, the average CTOR is 10.5%. A/B testing is a great way to boost your CTOR.
8. Unsubscribe Rate
Quite possibly the most feared metric, the unsubscribe rate measures the number of people opting out of your email campaign (or the number of unsubscribers). It lets you know people have received the email and did not find it engaging or valuable. Many marketers overlook this considering it a vanity metric.
Pay attention to upswings in this metric. Did they follow an increased frequency of emails? Did they follow a new marketing style? This number can tell you what doesn’t work with your email marketing campaign, and therefore, you’ll learn more about what does. As such, it is crucial for your email marketing analysis.
For reference, the average unsubscribe rate is about 0.2% to 0.5%. If it is higher than this, consider adjusting your opt-in process. You may also want to change the email frequency, channel, or targeting to maintain your subscriber list.
9. Revenue per Subscriber
The revenue per subscriber KPI lets you track the performance of each email in terms of revenue, making it crucial for any campaign with the goal of generating sales. This metric will tell you how much you earned for each email address.
Calculating this metric is as simple as dividing the total revenue generated by the number of subscribers and multiplying it by 100.
If your revenue per subscriber is lower than you want it to be, you have several options: optimize pricing, upsell, or cross-sell. You can also work to personalize customer service and reduce churn.
10. Overall ROI
Return on investment is one of the most commonly used by any business. As a KPI, ROI measures how much email marketing brings in minus any expenses. It directly subtracts the total spent from the total revenue. ROI for email marketing is estimated at about 122%, making it more cost-effective than other digital marketing methods.
That is an industry-wide figure, but tracking the ROI for email marketing lets you compare it to other marketing strategies. This can help you confirm that email is indeed better than marketing on other channels for your brand. Or it can let you confirm that email marketing works even better when combined with text marketing.
You can also compare the ROI for different types of campaigns or use A/B testing to see how to maximize your ROI. If you want to optimize your ROI, consider lead generation campaigns or reevaluating how frequently you send emails. You also want to optimize your emails for mobile, if you haven’t already done so, and segment your list to boost campaign performance.
How to Keep Growing with Email and Text Marketing
Tracking email marketing can be difficult and demanding. Many business owners simply don’t have time or sufficient knowledge on how to track marketing campaigns, leading to a drop in their effectiveness.
But with the right tools, you can easily grow your email and text marketing campaigns and track their performance. Podium is one of these tools, as it helps develop and measure email marketing campaigns for small businesses. Podium incorporates text marketing as well as email marketing, adding the most effective way to market your business to your toolbox. Text messaging has a higher open rate than emails, and many customers prefer it over other communication channels.
Explore customer success stories to see how Podium’s text and email marketing can help you grow your business.
