With more than 4 billion daily email users, email marketing remains one of the most effective ways to reach your target audience. Email marketing can be used to build relationships with customers, promote new products or services, or simply keep your audience up-to-date on what’s going on with your business.
However, email marketing is only effective if you’re monitoring the right metrics. By tracking email marketing KPIs, you can ensure that your campaigns are performing well and achieving your desired results.
Not sure which KPIs to track? Whether you need to grow your subscriber base, generate more leads, or convert existing leads into customers, there’s a KPI for you. Here are 10 essential email marketing KPIs that every business should be monitoring.
What are KPIs?
KPIs, or Key Performance Indicators, measure a company’s performance against specific objectives. Effective KPIs provide valuable insights that businesses can use to make informed decisions and improve their operations.
Email marketing KPIs are no different. By tracking the right email marketing metrics, you can improve your campaigns, increase your ROI, and better focus your efforts.
10 essential email marketing KPIs
Email marketing KPIs provide the insights needed for you to fully optimize your campaigns. Depending on the nature of your business and your goals, select 3 to 5 primary metrics to track. Here are 10 important KPIs to consider:
1. Deliverability rate
Just because you have 1000 subscribers doesn’t mean that all 1000 will receive your emails. Email providers have strict rules about what does and does not constitute spam, which can cause your emails to be filtered out or even blocked.
Your deliverability rate is the percentage of emails that are successfully delivered to subscribers’ inboxes. To improve this rate, follow these best practices:
- Use a reputable Email Service Provider (ESP)
- Keep your list clean
- Avoiding common spam triggers
- Remove hard bounces
- Monitor your spam complaint rate
If you have a large email list, there is no way to maintain a 100% email deliverability rate. However, these guidelines will help to ensure that as many of your emails as possible are successfully delivered.
But it’s important to note that there’s a difference between your email being “delivered” and making it into the recipient’s inbox. Even delivered emails may land in the spam folder or Promotions tab. For this reason, marketers are beginning to use Inbox Placement Rate (IPR) to measure the number of emails delivered successfully to the inbox.
2. Open rate
Email deliverability is only the first battle. Once your emails have made it into subscribers’ inboxes, you need to encourage them to actually open and read your message. That is why you need to track the email open rate.
Open rates are a good indicator of how successful email marketing campaigns perform. If you have a low open rate, it may be an indication that your subject lines are uninteresting or that your emails are going to the spam folder. To increase your open rates, try these strategies:
- Personalize your emails
- Create attention-grabbing subject lines
- Write for mobile users
- Test different subject lines
- Test different times of day
- Improve your sender reputation
Email open rates vary based on the industry, so it’s important to benchmark your performance against competitors. Ecommerce businesses, for example, generally aim for an open rate of 20% to 30%.
How to calculate email open rate
To compute your email open rate, divide the number of opened emails by the total emails sent and multiply the result by 100.
3. Click-through rate
Click-through rate (CTR) is another foundational email marketing KPI. It measures the percentage of people who click on links in your email after opening the message. Tracking CTR will help you determine whether your marketing campaign is motivating your subscribers to act.
According to Campaign Monitor, the average click-through rate across email marketing campaigns from all industries is 2.3%. If your CTR is much lower than this, your content may not be engaging enough or your offer may not be compelling enough.
To improve your click-through rate, focus on these strategies:
- Segment your email list
- Create targeted content
- Include a strong call to action
- Make it easy to share your email
- Test different subject lines
How to calculate click-through rate
To calculate your CTR, divide the number of unique link clicks in your email by the total number of emails delivered and multiply by 100.
4. Click-to-open rate
Click-to-open rate (CTOR) shows the percentage of people who click through an email relative to the number of opens. Simply put, CTOR tells you how effective your email content is without considering the influence of your subject line or sender reputation.
For example, a high CTR could be driven by a great subject line, but a high CTOR is more clearly the result of quality email content. If your open rate is high and CTOR is low, then you only nailed the subject line. On the other hand, if you have a high CTOR but a relatively low open rate, your offer was likely strong but the subject line didn’t resonate with your audience.
How to calculate click-to-open rate
To determine CTOR, divide unique clicks by unique opens and multiply by 100.
5. Bounce rate
As mentioned before, not all emails you send will be delivered to the recipient’s inbox. When this happens, we say the email has “bounced.” That’s why it is very important to track bounce rate, which measures the percentage of emails that are not making it into your subscribers’ inboxes.
Email bounces occur for a variety of reasons. For instance, wrong email addresses, spam complaints, flagged email content, a down server, poor deliverability, and sender reputation.
There are two types of bounces: soft bounces and hard bounces. A soft bounce is temporary. This means the recipient’s email is valid, but there’s a delivery issue like a full inbox. A hard bounce, on the other hand, is a permanent error, such as an invalid email address.
A high bounce rate is not a good sign — it can negatively impact your sender reputation, delivery rate, and overall email marketing efforts. To avoid this, follow these tips:
- Regularly clean your email list
- Remove repeated soft bounces
- Leverage double opt-in
- Monitor your email content
- Use an Email Delivery Service
How to calculate bounce rate
Divide the number of bounced emails by the total number of emails sent, and multiply the result by 100.
6. List growth rate
Growing your subscriber list is every marketer’s goal. Therefore, it is important to track your list growth rate, which measures the percentage change in your email list size over time.
There are many ways to grow your email list:
- Offering a lead magnet
- Run a contest or giveaway
- Add a sign-up form to your website
Regardless of which strategy you use, it is important to track your progress so you can determine what’s working and what’s not.
How to calculate list growth rate
Subtract the number of unsubscribers from the number of new subscribers. Divide this figure by your total number of subscribers at the beginning of the period, and multiply the result by 100.
7. Email sharing rate
Email sharing rate is a measure of how often your subscribers forward your email content to their friends and colleagues. Email sharing is a great form of organic growth, so it can be helpful to monitor this metric and identify opportunities to encourage more sharing.
To encourage email sharing, consider the following:
- Include share buttons in your emails
- Make it easy to subscribe
- Create compelling content
- Ask subscribers to share your email
A high email sharing or forwarding rate indicates that your content resonates with your target audience, and they are excited to share it with others. This is one of the strongest indicators that your email marketing efforts are working.
How to calculate email sharing rate
Divide the number of shares by the total number of emails sent, multiplied by 100.
8. Unsubscribe rate
As a key input to your overall list growth rate, you may also want to monitor your unsubscribe rate. This is the percentage of email recipients who unsubscribe from your list after opening an email. The average unsubscribe rate for an email marketing campaign is between 0.2% and 0.5%.
The unsubscribe rate is a feedback mechanism that allows you to gauge the value of your email campaigns. If you see a significant uptick in your unsubscribe rate, it may be an indication that your content is not relevant to your audience or that you are sending too many emails.
How to calculate unsubscribe rate
Divide the number of unsubscribes by the total number of email recipients, multiplied by 100.
9. Conversion rate
Conversion rate is one of the most important email marketing KPIs as it directly influences real business outcomes. Email conversion rate measures the percentage of email recipients who complete the desired action.
For ecommerce businesses, this action is generally a purchase. However, a conversion doesn’t necessarily have to be monetary. Depending on your marketing goals, a conversion could be signing up for an event, registering for a demo, or downloading a white paper.
Whatever the desired action may be, it’s important to track your conversion rate so you can identify opportunities to improve your email marketing campaigns and grow your business. Here are a few tips on how to do so:
- Keep your emails short and to the point
- Use strong calls to action
- Include a sense of urgency
- Optimize the landing page
How to calculate conversion rate
Divide the total number of conversions by the number of emails delivered, and multiply the result by 100.
10. Email ROI
As with any marketing campaign, determining your overall return on investment (ROI) is vital. Of all key performance indicators, ROI is the most important because it forces you to measure the success of your email marketing campaigns in relation to your business goals.
Before calculating ROI, marketers must first determine both costs and attributable revenue. Email costs include things like staff salaries, design fees, software subscriptions, and email hosting charges. Email revenue is the sum of all sales generated from an email marketing campaign.
Your ROI will indicate how your marketing strategy is performing, but it does not tell you where to focus further your efforts. For that information, you’ll need to dive deeper into your other email marketing KPIs.
How to calculate email ROI
Divide your email marketing gross profit (total revenue minus campaign costs) by total campaign costs, multiplied by 100.
How to improve your email marketing with KPIs
Email marketing KPIs are critical for understanding how your campaigns are performing and where you need to refine your strategy. Once you have begun tracking your KPIs, here is how to use them to drive performance:
- Only track KPIs that align with your marketing goals: Don’t get lost in a sea of potential KPIs. Determine what outcomes help your business grow, and work backward until you land on a relevant KPI. Track only those that are most important to your organization’s success.
- Test to see what works for you: Constantly split-test your email marketing campaigns to see what your audience responds to. Try different subject lines, calls to action, images, and copy. By conducting A/B tests, you can optimize your campaigns for maximum engagement and ROI.
- Closely monitor your top KPIs: Once you have selected KPIs for your organization and begun conducting tests, keep a close eye on how each test affects your metrics. Doing so will help you quickly identify what strategies are working and which ones need to be scrapped.
Email marketing KPIs are essential for any organization that wants to improve its email marketing strategy. These metrics will help you track your progress, optimize your campaigns, and ultimately grow your business. They will point you in the direction of areas that need improvement and give you the insights you need to make data-driven decisions.
In summary, here are 10 email marketing KPIs that every marketer should track:
- Deliverability rate
- Open rate
- Click-through rate
- Click-to-open rate
- Bounce rate
- List growth rate
- Email sharing rate
- Unsubscribe rate
- Conversion rate
- Email ROI
Email marketing KPI FAQs
The effectiveness of email marketing can be measured by looking at a variety of metrics, including deliverability rate, open rate, click-through rate, and ROI. Comparing these email marketing KPIs to your specific objectives will give you a good idea of how well your strategy is performing.
The most important email marketing metric is the open rate. While opinions on this topic are varied, open rate helps you understand deliverability, sender reputation, and the relevance of your business to your subscriber list. If you have a strong open rate, you can optimize your copy, offer, and marketing strategy to improve revenue per subscriber.
The success of an email marketing campaign varies based on the industry. In the direct response and ecommerce markets, revenue per subscriber is often used to evaluate the success of a campaign. For a more detailed analysis, however, other email marketing metrics like open rate, click-through rate, and unsubscribe rate should be considered.