Email marketing has proven to be one of the most effective methods to attract, engage, and nurture customers. How has it managed to deliver results consistently? First off, the sheer number of people who use it everyday makes it a powerful tool. 

As of 2020, over 4 billion users engage with their emails actively. Second, emails are highly customizable. Segmented campaigns have resulted in a staggering 760% increase in revenue, meaning emails can tend to the specific needs of each of your buyer personas.

However, to drive performance and achieve the results that you aim for, your email marketing strategy will need to be guided by the objectives of your campaign. And this is the most common mistake made by email marketers—they don’t create an email marketing campaign with specific goals in mind.

Before you craft your next email campaign, take time to reflect and answer this question: “What do I want to achieve with my email marketing efforts?” Here are some common email marketing goals:

  • Increase subscribers
  • Generate more leads 
  • Convert leads into buyers
  • Retain customers
  • Promote content

Once you’ve set a concrete goal, you’ll need to establish a strategy that measures and illustrates your progress. Therefore, understanding email marketing metrics is crucial to making your email campaign(s) successful. 

In this article, we’ll take a deep dive into the top 10 KPIs (Key Performance Indicators) that you should track and analyze for email marketing. We’ll also discuss the importance of each KPI, and identify which metrics are best suited for your goals.

What’s A KPI?

KPI stands for Key Performance Indicator. It indicates progress towards a goal by quantifying it, thus making it measurable. KPIs help you gauge the success of your marketing campaigns with respect to the objectives you’ve set out to achieve. Here are four easy steps to establish KPIs:

  • Determine your campaign’s key objective(s).
  • Based on the objective, define success.
  • Ask how this form of success can be quantified.
  • Choose KPIs best suited to measure your campaign.

To make the last step easy for you, let’s explore the most commonly used KPIs to measure the success of an email marketing campaign:

1. Open Rate

As the name suggests, open rate is the number of email recipients who actually open your email. This is the most fundamental measure to assess the performance of your campaign. Most successful email campaigns have an average open rate around 15-25%. 

Open rates directly indicate the strength of your subject line. A good marketer is one who is constantly A/B testing subject lines to optimize the campaign. A/B testing is the process of comparing the performance of two versions of an email subject line in order to decide which version drives higher results. 

Many such tests have indicated that adding certain elements to your subject line can result in higher open rates. For example, personalization by including the recipient’s first name, adding emojis, or using humor have proven to be successful methods. While open rate is a measure of your campaign’s success, is it the most reliable one?

Probably not if you tend to include images or other media in your emails. An email will be counted as open only if the images embedded in the email were received by the recipient. However, many people have settings that block these images. So while open rate can be a good metric to guide certain elements of your campaign, you must use it alongside other metrics to develop an accurate tracking system. 

2. Click-Through Rate

Click-through rate, commonly known as CTR, reflects the number of email recipients who clicked on one or more links shared in your email. These email interactions can then be used to identify the kind of content that your readers prefer to engage with.

The average click-through rate is around 2.5%. If you’re looking to improve CTR, try adding multiple links in your email copy to increase the opportunity for interaction. Also, test your call-to-action (CTA) button to make it stand out. The smallest changes like color and font can dramatically increase your click-through rate.

3. Conversion Rate

This metric goes a step further. While CTR reflects the number of people who clicked on a link, conversion rate shows how many recipients completed a desired action after clicking on a link. For instance, if your link opens into a submission form, you can see how many people actually filled out the form. If it took your recipients to a website’s product page, you can see how many people made a purchase. This KPI lends direct insight into your return on investment.

If you have a high conversion rate, then the dollars spent on your campaign are being put to good use. What’s a good conversion rate? While several factors, like industry, geography, type of email, etc. influence the rate of conversion, an average of 12-15% is widely considered to be good.

However, since your conversion relies so heavily on your call-to-action, try and test what phrases, colors, buttons, etc. work for your campaign (A/B testing can be useful here, too). These results can help you increase your conversion rate.

4. Bounce Rate

This helps you measure the number of emails that weren’t successfully delivered to the recipients on your list. There are two types of bounces—hard and soft. While hard bounces indicate permanent delivery failure, soft bounces are temporary issues that usually exist at the receiver’s end. For instance, their inbox could be full. However, most soft bounces can be converted into successful deliveries, if the email is resent a few days later.

Bounce rates affect your digital reputation that is constantly evaluated by email service providers. Hence, email addresses that show a hard bounce should be eliminated from your email list. Cleaning up your list will also make your KPIs more accurate.

5. Unsubscribe Rate

This metric evaluates the percentage of recipients who unsubscribe from your list after receiving or opening a particular email. The unsubscription rate demonstrates how well your content resonates with your recipients. If you see an alarming rise, you need to evaluate the quality and relevance of your content. It is thus recommended that your unsubscribe rate stay below 0.5%.

Having said that, every company wants to create a list that comprises engaged recipients. So tracking users who unsubscribe helps you weed out unengaged users. In addition, your unsubscribe rate also helps determine the list growth rate, which we’ll discuss next. 

6. List growth Rate

This email marketing metric helps you track the rate at which your list is growing. To calculate the growth of your list, you can apply this simple formula:

{(New subscribers - No. of unsubscribers) Ă· Total no. of email addresses on your list} x100

As most marketers come to realize, no matter how good your content, your email list depreciates by 22.5% every year. So as long as you have a healthy rate of new subscribers, your email marketing efforts are right on track.

7.Forwarding Rate (Email Sharing)

This email marketing metric measures the percentage of recipients who either forwarded your email to a friend or shared it on social media. This metric is a good measure of your content quality. When someone shares your content with their inner circle, it shows that they trust your brand enough to advocate for you. This not only increases the reach of your content but also impacts your sales since 83% of consumers are influenced by word-of-mouth when making a purchase.

8. Action/Engagement Over Time

The success of email marketing heavily relies on understanding the behaviors and patterns of your subscribers. Which days of the week, and what times of the day do you see the highest open and click-through rates? As you gather and assess this information over time, you’ll establish an email schedule that works best for your list of subscribers. This can further help you determine the frequency of your email campaigns.

email marketing metrics
  As per CoSchedule, middle of the week is the best time to send your emails.
email marketing metrics
The recommended times to send emails to achieve the highest open rate.

9. Spam rate

Spam rate is the number of times your email gets marked as spam. While it’s not the most encouraging metric there are ways to keep your spam rate low. Many email marketing providers assist you with a spam score. This will help you filter out trigger words or keywords that categorize your emails as spam. 

After all, what good is an email if it lands in the junk folder. So, before you send out your next email, ensure that your score is 8 or above (out of 10) so you’ll steer clear of the spam territory.

10. Overall ROI

As for any marketing channel, the most important question is, “what’s the ROI of my email campaign?” Here’s a simple way to calculate it:

{(Sales driven by the campaign - Money spent on campaign execution)  ÷ Money spent on campaign execution} x 100

Reports suggest that for every $1 spent on email marketing, the ROI it brings is $38. This impressive statistic is reason enough to focus on your email marketing strategy.

Which KPIs Do I Choose For My Goal?

No matter how aesthetically pleasing or relevant your content is, if you haven’t optimized it for metrics that contribute to the success of your campaign’s goal, the results will be far from impressive. So let’s talk about which email marketing metrics you need to focus on based on your specific goals.

Increase Subscriber Database

If you’re looking to add subscribers to your list, then your email should be optimized for subscriber growth rate. Your goal here is to measure the number of people who shared their contact details and were added to the subscriber database. Continue testing phrases like “Be the first to know,” “Join our blog community,” “Subscribe to our weekly newsletter,” “Never miss out on,” etc. to see what works for your readers.

Other than measuring the growth in your subscriber rate, it’s equally important to track the unsubscribe rate. This is important since it indicates how your content is resonating with your current subscribers. If you see an increase in the number of unsubscribes, it’s time to reevaluate the content, style, and design of your email.

Generate More Leads

If your goal is to generate more leads, then your email needs to send out a compelling message. This will encourage recipients to take the desired action, which in this case is to fill out a form. Your CTR and conversion rate will further help you analyze how effective your email is. 

Convert Leads to Buyers

As you move from the top to the bottom of the marketing funnel, your emails will need to be more educational about your products and offerings. Adding links to videos to showcase your products and sharing testimonials of existing customers can greatly help in this process. Also, phrases like “Start your free trial today,” “Get a demo,” or “Talk to our Sales Specialist” are more persuasive than a predictable “Learn more.”

You want to focus on bottom-of-the-funnel metrics like conversion and purchase rates. Consistently analyzing these metrics will help you gather data on the behavior of your customers. This, in turn, will help you determine the kind of content that convinces your subscriber to make that final purchase.

Choosing The Right KPIs = Email Marketing Success

Email marketing metrics offer a direct view into the activity and engagement of your users. These valuable insights, if used correctly, can turn unsuccessful campaigns into high performers. Hence, choosing the right email marketing metrics is the prerequisite to building an efficient and productive email marketing strategy. 

If you’re looking to optimize your email marketing strategy, and better understand the response of your audience to your emails, check out Knotch’s Sentiment Analysis for Emails. You can also request a demo for further information.