Email marketing is one of the best channels for promoting your business. The low cost of operating an email marketing campaign, ease-of-use, and automation capabilities can provide an excellent Return On Investment (ROI). Most email marketing platforms will provide a plethora of analytics for each email message and campaign that you send. You may not be familiar with each metric or know how they rank up next to each other, but after reading this article you will be.

The Top 5 KPIs for Measuring Email Marketing Success

1. Open Rate
   Higher = Better
2. Click Through Rate
   Higher = Better
3. Conversions
   Higher = Better
4. Bounce Rate
   Lower = Better
5. Unsubscribes
   Positive = Better

1. Open Rate

The higher the open rate the better (18% – 20% average).

No big surprise here… If you send an email you want people to open it. But how is the open rate measured and what is considered good?

Measuring Open Rates

Email open rates are calculated through the loading of an image(s) within your email. Each recipient of your email campaign will get a uniquely named image and when loaded, it will tell the email marketing platform that the email was viewed. The open rate should only be calculated once per email address, so if someone views the same email twice or on two different devices it would only count as one.

Good Open Rates vs. Bad Open Rates

The average open rate, based on statistics from two major email marketing providers list an average open rates of between 10% and 28% (depending on the industry).

Constant Contact – Average Industry Rates for Email as of April 2018

Mailchimp – Average Email Campaign Stats of MailChimp Customers by Industry

The overall average open rate across all industries in both reports is between 18% and 20% respectively.

The open rate is affected by a few factors

• Industry
  Some industries have a higher rate of B2B emails which can reduce your overall voice share.
• List quality
  A poorly maintained or improperly obtained email list will have a lot less opens and more “straight to spam” folder filtering.
• Content quality and offerings
  Poor content quality or lack of incentive for people to read your email will reduce your chances of being viewed.
• Send frequency
  If you rarely send, you will likely not stand out as a worthwhile read. Send too frequently and you will be moved to the “maybe later” folder before being viewed.

2. Click Through Rate

The higher click through rate the better (2% – 7% average).

The click through rate is an excellent metric for determining your email marketing effectiveness as it tells you that your content and/or calls to actions are engaging. The more engaging and actionable your content, the higher the opportunity for converting that email recipient to a sale and customer.

Measuring Click Through Rate

Most email marketing platforms will convert any link that you place within an email message to a custom link that is uniquely coded to recipient and the final URL (the original link you put in the email message). When a recipient clicks on the link it will track which link was clicked and which user clicked it before redirecting the user to the final URL.

The click through rate is usually calculated as an aggregated action of the entire email. This means that if a user clicks on ANY link within the email it will count as a click through for your email. So, if a user clicks on two different links within your email it will only be calculated as a single click within the overall click through rate metric. Analytics about click through rates for individual links is also available in most email marketing platforms, but usually takes a bit more digging and data sorting.

Click through rates are impacted by

• Include a link in your email message
  You can’t have a click through rate without a link.
• How much or little your links stand out
  Ensure that your links are styled to stand out from the rest of the email copy.
• The actionability of your links
  Make sure your links have actionable words like “Reserve Your Table” or “Save Today”.

3. Conversions

The higher conversion the better.

A conversion is the most coveted metric to track as it tells you that the recipient performed the action that you were looking for. A conversion usually involves clicking on a link within your email to your site and then performing an action like purchasing a product, booking a reservation, or submitting a lead form.

Measuring Email Conversions

The measurement of conversions is more complicated than other metrics discussed. It requires additional configurations within your email marketing platform, as well as integrations with third party analytic systems like Google Analytics and your website. Once everything has been setup you will be able to track a click through from an email, all the way through to the action that you are looking for.

Mailchimp – Additional Tracking Options for Campaigns

Conversions are usually tracked through a combination of your email marketing platform and your website’s analytics platform. But you will likely find that the best data source will be within your site’s analytics as that is where the action that you are looking to be taken is performed. When properly configured and integrated, Google analytics can establish a conversion for each referral source, email campaign, and each unique link for a designated conversion. This will allow you to calculate total conversions and conversion rates in aggregate or in fine detail.

Conversions are impacted by

• The exact same factors as click through rates
  In order to make a conversion you first need to get the email recipient to click on a link, so the same factors that impact click through rates will also impact conversions.
• The load speed of your site
  Make sure your site loads quickly, a slow loading site will greatly reduce your conversions.
• Mobile friendliness of your site
  A large percentage of people will view your email on their mobile phone, make sure that your site is fully featured and easy to use for that mobile audience.
• User experience and ease-of-use
  Ensure that your site is easy-to-use and the actions are clearly displayed and intuitive to use for the visitor.

4. Bounce Rate

A lower bounce rate is better.

Your email bounce rate is a good indication of the overall health of your email list. A mature email list that is legitimately required and cultivated will typically have a low bounce rate, while a new list will typically have a higher bounce rate. If you are not following best practices and have made a mistake to purchase your list, expect a lot of bounces and probably spam reports (do not buy lists).

Measuring Bounce Rates

There are two types of bounces, hard bounce and soft bounce. A hard bounce means that the email is no longer valid or being received. This can happen when someone changes jobs or closes an email account. If you see hard bounces for emails that you know were good, you can try reaching out to them through other channels to update their email address. Most email marketing platforms will remove a hard bounce from your list.

A soft bounce is considered temporary, it is usually triggered by an email box that is full or even an out of office notice. Most email marketing platforms will remove a soft bounce if it occurs in several consecutive campaigns, check with your account settings to determine what that threshold is and adjust as needed.

Bounce rates are affected by

• Age of list
  As noted previously, a list that has been active for a long time will likely have a lower bounce rate, while new lists will have a higher bounce rate.
• Quality of list
  If your email list is acquired through invite and legitimate signups you will have a much lower bounce rate than a purchased list. So, please don’t waste money on purchased email lists.
• Time of year
  Those pesky holidays will have a higher bounce rate due to an increase of hard and soft bounces.

5. Unsubscribes

The fewer people that unsubscribe from your list the better.

Again, this is not a big surprise, but you don’t want people to unsubscribe from your emails. An unsubscribe can be due to several factors, we recommend setting up an optional unsubscribe survey to help you to find out what the reason is, otherwise you will have to suffice on guessing.

Measuring Unsubscribes

An unsubscribed is triggered by a user request or action. Typically, the user will click on an unsubscribe email link that is in the footer of your email.

Factors impacting your unsubscribes

• Bad content
  If your content is bad or controversial you will have a much higher rate of unsubscribes.
• Content no longer relates
  Content/people can and will change. Maybe your content has shifted to a different aspect of your business, or the email recipient has changed and your content no longer relates to them.
• Too many emails
  This typically happens with aggressive email campaigns or marketing platforms that are not configured correctly and are sending emails too frequently.
• I never subscribed in the first place
  This usually only happens with addresses that are obtained and added to a list without the recipients consent. On rare occasions it can happen if you are sending emails very infrequently as a the recipient forgets that they did indeed subscribe months prior.