Did you know that most email marketing services charge you based on the number of email addresses in your list? Some will count an email in your quota even if you aren’t sending emails to that address. You should also know that email services such as Gmail may not deliver your emails if there are signs that people aren’t opening them? Worse still, trying to send emails to address that don’t exist can get you flagged as a spammer or worse, your account can be locked.
The solution is to track your email metrics. These help you understand what’s working and what’s not working in your emails. Who’s engaging with your emails and who’s just costing you time and money. Keeping your list under control could save you money.
In this article, I talk about some of the email metrics you need to track to make sure you’re getting the most from your email list.
Comparing apples and oranges
Especially when you’re just starting to look at your metrics, the important thing to know is how you compare. But who you compare yourself too is extremely important. The one thing you don’t do is compare your numbers with a business who operates in a completely different industry or a different country. Location is an important part of benchmarking your numbers with other business.
For results that relate to the Australian market, check out the Australian Email Marketing Benchmarks.
The email metrics you need to track
Not all the metrics listed below are important to all businesses. It depends on your strategy. For example, I don’t care about open rates, but I do care about click-through rates. This is because click-through rates are a measure of engagement with my subscribers.
If a business sells one product, churn rate may not be important.
One important thing to understand is that not all email marketing service providers calculate a metric in the same way. There is no standard way of measuring some metrics. Does this matter? I don’t think so because if you’re measuring the same way each time, you will get a good understanding of what’s happening.
Deliverability
What is deliverability?
Not all the metrics listed below are important to all businesses. It depends on your strategy. For example, I don’t care about open rates, but I do care about click-through rates. This is because click-through rates are a measure of engagement with my subscribers.
If a business sells one product, churn rate may not be important.
One important thing to understand is that not all email marketing service providers calculate a metric in the same way. There is no standard way of measuring some metrics. Does this matter? I don’t think so because if you’re measuring the same way each time, you will get a good understanding of what’s happening.
Your deliverability rate tells you how many emails reached the recipient’s Inbox.
Some of the things that can impact deliverability metric include:
- The receiving domain is invalid.
- The recipient’s address does not exist.
- The sending IP address is blocked or blacklisted.
- Your sending domain has not been authenticated.
- You email platform has not been setup correctly.
Here’s how to calculate it:
One thing though. Different service providers define delivery rates in different ways. They could be basing the calculations purely on bounces.
Why does deliverability matter?
This is an important metric because if you continually send emails to addresses that aren’t valid, you will be attracting unwanted attention from email services such as Gmail, Hotmail, or Yahoo. This is because doing so is an indicator that you may be a spammer.
What is a good deliverability rate?
There is no magic number. For this metric, a higher number is better. Having said that, 95% is typical across most industries while 99% would be considered fairly good. Again, research typical results for your industry in your location at different days and times.
How do you improve your deliverability?
The key to maintaining a good rate or improving your delivery rate is to maintain a healthy email list. You can do this by having a double opt-in for web forms or simply asking someone to confirm their email address before you send them anything. Many email service providers won’t send emails to unconfirmed address and if you do this yourself, you can unsubscribe them and remove the address.
Regularly scanning your list for bounced or unconfirmed email address and deleting them keeps your list healthy and can improve your delivery rate.
Don’t use purchased email lists.
Bounce rate
What is bounce rate?
When an email doesn’t reach the recipient’s inbox, a message is usually returned to the sender, in this case your email marketing platform, with an explanation as to why. In email marketing, this is known as a Bounce.
There are different reasons an email can bounce including:
- The recipient’s inbox is full.
- An incorrect email address.
- The recipient’s email address no longer exists.
There are two types of bounces:
A hard bounce happens when your email is rejected by the receiving server and is unlikely to ever be successfully delivered.
A soft bounce happens when your email is rejected by the receiving server but there is a chance that future emails will be successfully delivered.
Bounce rate is expressed as a percentage. To calculate your bounce rate, divide the number of bounced emails by the number of sent emails.
Why does bounce rate matter?
Your bounce rate can be an indicator of deliverability problems. If you have a high bounce rate, it can be due to a technical glitch with the sending or receiving server, a poor sender reputation meaning your emails are detected as spam before reaching the recipient, or problems with your list.
What is a good bounce rate?
The lower the number, the better. But you will rarely have a bounce rate of 0% because many of the reasons your emails bounce are beyond your control. The key is to monitor the rate and, if possible, investigate the type of bounce.
How do you improve your bounce rate?
Don’t suddenly send large numbers of emails with a new email service provider. Warm it up by sending smaller numbers over a period of time. 500 emails in one hour is a good starting point.
Don’t suddenly start sending large volumes of emails after a period of inactivity.
Use double opt-in or another email verification tactic to confirm the validity of an email addresses before sending anything to them.
Don’t use purchased email lists.
And finally, maintain a healthy email list.
Open rate
What is open rate?
Email open rate is simply how many of your recipients opened the emails of any given email campaign.
It’s shown as a percentage and is calculated by dividing emails opened by emails successfully delivered to inboxes.
Why does open rate matter?
It doesn’t and the reason is because of the way email open rates are tracked.
Your email marketing provider tracks opens in two ways.
One way is to record when the recipient clicks a link in your email. The other is when a tiny, transparent image is downloaded to the email client. The problem with the last approach is that the recipient may not display images by default and so while they read your email, it’s not recorded as an open because this image file hasn’t been displayed.
Having said that, knowing what your numbers usually are and looking for significant changes can give you some insight into what’s happening with any given campaign.
What is a good open rate?
While I’ve said that this metric isn’t important because of how open are tracked, higher is better.
Many things can affect your open rate. And a ‘good’ rate varies between countries, industries, companies, day of the week and time of the day.
How do you improve your open rate?
Firstly, know YOUR numbers. Send one or two campaigns and record the result. Then you test changes.
Improve your subject lines
The BEST way to improve your open rates is to have better subject line. This, along with your preheader text and sender name, is the first thing your recipient will see and plays an important part of their decision to open your email.
Change other parts of your email
Here are some things to change and test:
- Subject line lengths
- Subject line tone
- Preheader text
- Include a person’s name vs company’s name as the sender
- Try sending email of different days of the week
- Change the time of day you’re sending
- Change the sending frequency. Daily vs weekly vs monthly
- Optimize for different devices and clients
Simple is often better.
Evaluate the content you’re sending. If you send irrelevant content, the recipient is less likely to open future emails.
Deliver content that your recipients want and expect. If it’s not relevant or interesting, not only won’t they open the email, but they may unsubscribe.
Don’t change too many things at once. The reason is that one change may have resulted in a better number but the other change you made resulted in a lower number and off-set the outcome. For example, don’t change day of the week and time of day. You could improve your subject line and add preheader text.
Click-through rate
What is click-through rate?
This is the percentage of people who clicked a button, link, or image in an email.
It’s calculated by taking the number of clicks divided by the number of emails successfully delivered in any one campaign.
For example, if 100 emails were delivered and 4 people clicked a link in that email, you would have a click-through rate of 4%.
Why does click-through rate matter?
The email click-through rate (CTR) is probably one of if not the most important metric to track. It’s important because it tells you how many people are engaging with your email content. You’ve managed to get the email delivered and caught the recipient’s attention with a good subject line and pre-header text. The next challenge is to get them to do something.
But don’t track this metric in transactional emails such as order confirmations, or other non-marketing type emails. Emails that do not have a call-to-action shouldn’t be tracked for this metric.
What is a good click-through rate?
Higher is better but as with other metrics, many things influence the click-through rate for a particular campaign.
As a generalisation, anything above 3% is a good rate. You may see spikes when you send a great offer especially around Christmas time. Personalised offers such as birthday gifts can also get you higher click-through rates.
How do you improve your click-through rate?
It’s at this point you should have started to notice the same points helping you improve a metric.
- Improve your content. Deliver what you originally promised.
- Be mobile friendly. Buttons and links should be easy to click on small devices.
- Deliver relevant content (remember segmenting?)
- Time your delivery. Day of the week, time of the day.
- Maintain list hygiene. If you’re audience isn’t engaging, consider removing them.
Instead of trying to figure out what a “good” click-through-rate is, focus on where you are now vs. where you want to be.
Click-to-open rate
What is click-to-open rate?
Click-to-open rate (CTOR) is the percentage of recipients who opened your email and clicked a link in that email.
So, if 100 emails were delivered, 10 were opened and five people clicked a link, your CTOR would be 50%.
Why does click-to-open rate matter?
This metric tells you a lot about the relevancy of your email content and how engaged your audience is. But, like other metrics, it doesn’t work on its own. For example, if you’re emails are being opened (open rate) but not many people are clicking links, buttons or images, (low click-through rate), your click-to-open rate (CTOR) will also be low.
One reason could be that you had a great subject line but failed to deliver in the content. You would look at things such as email design or calls-to-action. Probably the biggest consideration would be relevancy to the recipient. Sending fashion offers targeted at families will not get good CTOR for recipients who don’t have children.
What is a good click-to-open rate?
Because open rates can be inaccurate, you could expect your CTOR to be inaccurate. This is because the open rate may not be accurate. Again, track your own metric and compare month on month or quarter on quarter. This will tell you more than comparing yourself to someone else in the same location and industry.
How do you improve your click-to-open rate?
It’s at this point you should have started to notice the same points helping you improve a metric.
- Improve your content. Deliver what you originally promised.
- Be mobile friendly. Buttons and links should be easy to click on small devices.
- Deliver relevant content (remember segmenting?)
- Time your delivery. Day of the week, time of the day.
- Maintain list hygiene. If you’re audience isn’t engaging, consider removing them.
Unsubscribe rate
What is an unsubscribe rate?
The unsubscribe rate tells you how many people clicked the unsubscribe link for a given email campaign. Basically, they are telling you they no longer want to receive emails from you.
To calculate the unsubscribe rate, just divide unsubscribes by delivered emails.
Why does unsubscribe rate matter?
Basically, this metric tells you whether you’re delivering useful, relevant content to your audience. When you’re looking at this, take it in the context of a single campaign. For longer term tracking, look at churn rate.
Most email marketing platforms will, by default, ask why someone is unsubscribing. Knowing why help you adjust your strategy to reduce your unsubscribe rate.
You should also know that your email marketing platform will also use this information to assess your performance. If too many people are indicating that they didn’t consent to receive your emails, your account could be locked.
What is a good unsubscribe rate?
For this metric, lower is definitely better. As I mentioned, while you can use this metric for long term tracking, it doesn’t take into account natural churn. I recommend using this metric for short-term tracking for single campaigns. For a single campaign, you should be concerned if your rate is above 0.5%. If you do have an unusually high unsubscribe rate, look at your latest lead generation strategies and most recent campaign. There may have been something you did or said that put people off. For example, too salesy too quickly.
You could also be attracting the wrong audience.
How do you improve your unsubscribe rate?
The way to decrease your unsubscribe rate is to be helpful and honest.
1. Use a Combination of double and single optins
2. Segment your audience (I’ve said that before)
3. Send useful and highly relevant content (I’ve said that before too)
4. Use great subject lines
5. Personalise beyond using their name (see point 2 above)
6. Don’t email too often or too infrequently
7. Optimise for mobile
8. Send great offers such as discounts and subscriber only content
9. Mix it up with text, static images and gifs
10. Ask for feedback
Above all, don’t make too many changes at once. One or two changes then test.
People unsubscribe for a reason. Find out what it is and fix it.
Churn rate
What is churn rate?
Your churn rate is the number of people who leave or are removed from your list. This can because they unsubscribed, marked you as spam, bounced or you removed them because they aren’t opening your emails, clicking links or even visiting your website.
Churn rate is a long term metric so calculating your churn rate should be done monthly, quarterly or even annually.
Why does churn rate matter?
Churn rate tells you how fast your list is growing or shrinking. Knowing this helps decide whether you need to adjust your list building strategy.
People can leave your list by unsubscribing, flagging your emails as spam, or they bounce
The other way they can leave your list is to become disengaged. You see this when people don’t want to unsubscribe, they just don’t open any emails. It’s this audience who can affect your deliverability.
Service providers such as Gmail look at this engagement to determine deliverability. If you continue sending it to people that don’t respond, the ISP might stop letting it through.
To avoid that, set up an automated re-activation campaign or get in the habit of reengaging or removing inactive contacts.
What is a good churn rate?
Ideally this number should be positive or at the very least, zero. Zero tells you that for each subscriber you lose, you’re replacing them. A positive number tells you your list is growing. But it does depend on your business. If you’re a seasonable business, you may see the numbers change at different times of the year.
For most businesses however, you can expect to lose 25% of your subscribers in a year. What you need to do is increase the number of subscribers by 25% each year.
And if you want this metric to be more actionable, measure it regularly – say monthly. Then calculate how many months your list will last if you don’t attract new leads.
Just take care when measuring your churn rate. A monthly churn rate of 5% may seem small, but that’s 54% across the year! So, you’d have to make up the loss, before your list grows.
How do you improve your churn rate?
Accept that people will leave your list. What you need to do is find out why. Was it too many emails? Too few? Irrelevant content? Simple ask.
When you notice trends, take action to correct it.
Above all, check your numbers each quarter or month. To do this, record the total number of active subscribers. At the end of the month or quarter, record the number of active subscribers and do your calculation.
Complaint rate
What is complaint rate?
This metric is also known as an ‘abuse complaint’ or ‘spam complaint’. It’s when someone reports an email as spam. Some email marketing platforms show you the total number of spam complaints for a campaign. Others show you an individual’s spam complaint and the reason why they did so.
To calculate your complaint rate:
Why does complaint rate matter?
The main reason to monitor your complaint rate is to stop your account from being locked or to stop email services blocking your emails because they perceive you as being a spammer.
Other reasons to monitor your complaint rate are that they are an indicator of list quality, and if you’re delivering quality, relevant content to your audience.
Remember, if some contacts you directly and asked to be taken off your email list, do it immediately.
What is a good complaint rate?
The best rate is the lowest one possible. But bear in mind it can depend on the market or niche you’re in.
In some countries, customers tend to ignore or simply unsubscribe from email they no longer want.
Some markets have more sceptical subscribers, who are quick to mark emails as spam.
Either way, you can keep your rate low by inviting contacts to unsubscribe – or remove them yourself if they’re no longer engaging.
There’s nothing worse than following best practices and then having your messages marked as spam – or being forwarded to anti-spam services.
How do you improve your complaint rate?
There is every chance that someone will mark one or more of your emails as spam. It can be more about perception than reality. What you need to do is control that perception.
Here are some things you can do to reduce the chances of someone flagging your emails as spam.
- Make sure they’ve confirmed that they want to receive your emails.
- Don’t take permission for granted
- Check your traffic sources
- Set expectations at the outset. What are the types of emails they will receive and how often.
- Send regularly. If you’ve said monthly, send monthly.
- Make sure your emails are relevant to your business and your dealings with the recipient.
- Maintain a healthy list. Remove inactive subscribers
- Provide value in your emails
- Make it easy to unsubscribe. A link rather than having to reply to an email
Signup rate
What is sign up rate?
This metric helps you understand the performance of your website in attracting leads. Getting leads is important because it’s leads we want to convert into prospects. As business owners, we should be monitoring the performance of our websites so it makes sense to look at how many of those visitors are ending up on our email list.
To calculate your sign up rate:
Why does sign up rate matter?
The signup rate shows how well you attract visitors to a landing page (such as via a PPC campaign) – and whether the page and signup form do the job.
Monitoring your signup rate gives you valuable information on how landing pages, opt-in forms, or ??????? are performing.
For example, you pay for Facebook promotions driving people to a website landing page. By tracking how many people visit the landing page and how many subscribers you get, you can get a good idea on the performance of your promotion and especially the performance of your landing page.
What is a good sign up rate?
This is your “there is no good, better or best” answer. It’s impossible to put a figure on it. Even the experts can’t agree with figures ranging from 3% to 10%. Anecdotal evidence says that figures of 50% or higher can be achievable.
What you need to remember here is that you’re comparing the number of site visitors. That should tell you that it’s your site that can have the greatest influence on sign ups. You can have great copy but your sign up form is poor. Another thing that can influence this conversion rate is the source of the traffic. Driving traffic that isn’t interested in your offer can negatively affect your rate.
Like other metrics we’ve talked about, measure, change, test, rinse and repeat.
How do you improve your sign up rate?
It seems like a simple question but to answer this properly could take an article longer than this one. So, here’s are a few key things you can do to increase your sign-up rate.
- Create strong calls-to-action
- Offer a guarantee
- Use popup forms for sign-up
- Offer an incentive
- Include as few fields as possible
- Use tangible action verbs
- Create dedicated landing pages for pay-per-click ads
- Don’t require registration in order to buy
- Don’t offer too many options
Average revenue per email sent
What is average revenue per email sent?
If you’re using email marketing to generate revenue and you’re trying to improve open and click-through rate, this one is a better metric to monitor for campaign performance. That’s because you’re measuring how much revenue you make from each email.
Simply divide your total revenue by the number of emails sent in a campaign or set period of time. In other words:
Why does average revenue per email sent matter?
For some people and some of your emails, it doesn’t because the email isn’t being used to help generate revenue. Transactional emails such as sign-up or order confirmation emails are tracked as they’re not designed to directly generate revenue.
If you do use emails to help generate revenue, it’s a useful metric to help you track the performance of your campaign. The thing is that not all campaigns are created equal. Even emails with a series each have a particular purpose. If you’re going to track this metric, as yourself if the email is meant to drive sales or not.
What is a good average revenue per email sent?
This one really does depend on your business, your email strategy, and the price of your product or service.
Again, start tracking your own results and evaluate, adjust, and test.
How do you improve your average revenue per email sent?
This one is fairly easy. Research shows that personalised, behavioural campaigns, generate a great revenue per email that generic emails. But why? Because you’ve segmented your list. Sending emails that are highly personalised and relevant to your audience. You’re sending them what they want. The challenge though is getting your email delivered to the inbox, getting your recipients to open them, getting them to take action, having awesome landing pages. Everything we’ve talked about comes into play.
Email campaign profitability
This metric helps you understand the cost of running your email campaigns. Are your campaigns costing you money or are they contributing to the profit of your business?
As with most calculations we make concerning profitability, we take the revenue we’ve bought in and subtract the costs to run the campaign including any costs of goods sold.
Our formula looks like this:
Why does email campaign profitability matter?
This metric’s very useful, but also tricky to measure.
As business owners, we should know the cost of doing business. After all, if you don’t know the costs, how can you know if you’re making or losing money?
What is a good email campaign profitability?
Again, it’s best to benchmark it against your own results. You can easily see if you’re going in the right direction.
How do you improve your email campaign profitability?
Like everything in business, if you want to increase profitability you could:
- reduce costs
- increase customer numbers
- raise your prices
- increase customer numbers
- increase average spend
Be careful of the first one in relation to email marketing. Changing providers could have a cost to change over. The best option here is manage your subscriber numbers if you have a paid plan.
Even if you’re not using your list to generate revenue, you need to know how much it’s costing you.
Wrap up
There you have it. 11 email metrics you need to track. I understand that not everyone will need all the metrics but you should at least look at the ones that keep you out of the spam folder and help reduce costs by keeping your email list healthy.
It’s a long list so choose which ones are important to you and start there. Which metrics do you find most useful? Do you check your metrics regularly? Let us know by commenting below.
Enjoy your day.
