Measuring, analyzing, and acting on the data collected during your email marketing is essential if you want to demonstrate the performance of your channel against other channels in your marketing team.
Email can provide all kinds of insights and complexities about customer behavior. Organizations only need to know what metrics to look for and what that data says about the state of a campaign or – more broadly – a business, in order to profit from it.
Metric system: three areas to focus on
Email metrics fall into three main areas:
Audience metrics, inbox and deliverability metrics, and program and campaign metrics.
Audience Metrics – This is basic subscriber data and includes their email addresses, as well as some behavioral data. This information is intended primarily for the marketing or email management team.
Inbox and deliverability metrics – Here’s the deliverability rate: How many emails arrive in an inbox? This information is useful for marketers, supplyability professionals, and those in more operational roles.
Program and Campaign metrics – These are the data that are supposed to be of most interest to the top-level members of the team. It includes basic information like open and click-through rates, but also focuses on the recipient’s next destination and includes conversion rates and, ultimately, a campaign ROI calculation.
Each set of metrics will be of particular interest to different employees or stakeholders within an enterprise.
The most basic Audience Metric is the number of subscribers. All of these may not be accessible, so there’s another divide between direct and non-direct mail subscribers.
Whenever a mailing list is reviewed, there are likely to be people opting to subscribe for a certain period of time and others actively hitting the unsubscribe button – opting in and opting out.
The subscriber list is also recalibrated through the list sanitization process. Addresses may be removed from the list due to inactivity, long periods of subscriber inactivity, or addresses that have been classified as hard to return. It’s also possible that some recipients marked a linked email as spam.
The second element of Audience Metrics concerns the activity of email recipients. Eg:
- recently: number of days since the customer’s last purchase
- Regularity: How many purchases did the customer make during the analysis period?
- Currency: How much did the customer spend during this time?
Using this data, marketers can calculate the lifetime value (LTV) of an email address.
Net Revenue x Gross Margin = Email Gross Margin
Email Gross Margin = Email Spend = Email Net Margin
Email net margin dollars ÷ average sendable base = value of an email address (12 months)
LTV is simply the above formula calculated over a specific time period – for example, the average number of years an email subscriber is likely to stay active on the sender’s file.
Delivery metrics and measurements
The index and distribution metrics show how powerful a mailing list is and its performance.
The key criterion here is bounce rate – or how many emails are rejected. There are two types of bounces:
hard and soft. A hard bounce occurs when an email is completely rejected from a subscriber’s inbox. A soft bounce is an email with no permanent bounce. For example, if someone’s inbox is full. If, after many attempts, the email fails to reach its target, it becomes a hard bounce.
Other important metrics and delivery metrics look at where emails actually reach the inbox. Inbox position measures email reaching subscribers’ inboxes instead of spam or “other” folders. Spam Location, on the other hand, measures the percentage of emails sent to the subscriber’s spam/other folders instead of the inbox.
Program and campaign metrics
This set of statistics tells important story marketers and colleagues need to know: how successful email marketing has been in not only reaching customers but generating sales. ?
Reaching someone’s inbox is one thing, but the next most important metric is the most important: open rates. Opens are tracked at two levels: Total Opens (the number of times the campaign’s audience opened this email) and Unique Opens (the total number of individual recipients who opened the campaign email).
The best metric is arguably Unique Opens. That said, due to recent iOS updates, especially the Email Privacy Protection feature, about 40-50% of emails opened will no longer be trusted due to changes in privacy settings. consumer privacy, which increases privacy around customer email behavior.
Once an email has been opened, how the person responds to it is also recorded. This can be the click-through rate that calculates the total number of clicks on a particular campaign as a percentage of total opens. Or at the other end of the spectrum, it could be the number of unsubscribes after opening.
Finally, the most important metric is the conversion rate. Invariably, “conversion” refers to a purchase event, typically where a call-to-action from an email leads to a website click and ultimately a purchase. So how does a marketer determine if an email campaign is successful? The key metric for this is calculated through a campaign profit formula that works as follows:
Revenue attributed to campaign x Applicable Gross Margin = Campaign Margin
Campaign Margin – Campaign Cost = Campaign Profit Allocation
Campaign Profit Allocation Campaign Spend = Campaign ROI
Regardless of which metrics you and your team spend the most time looking at, the ones listed above are the most important when it comes to living metrics. Learning how to compute, use them, and determine their impact on your program will give you and your team the tools to make better business decisions regarding implementation and optimization. campaign optimization.
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