Do you know how much return on investment your email marketing is generating? Follow our 3 tips for setting KPIs to calculate the real value of your email marketing to your business.
Tracking and measuring email marketing ROI
Every year someone denounces email marketing and proclaims that it is dead.
As a result businesses cut it out of their marketing plans and spend their money on the newest digital marketing fad. But while email marketing has been around for a long time, it still remains one of the most effective marketing channels available to a brand.
But in order to determine the success of your email marketing efforts, you need to be able to show the return on your time, efforts and finance that was invested in this channel. Are you tracking your email marketing results? Did you even set KPIs to measure your ROI against?
Here are 3 KPIs that will help you accurately calculate your email marketing ROI.
KPI #1: Database Growth
Calculating your subscriber growth after each campaign allows you to see the amount of new subscribers you’re adding to your database. These new subscribers are valuable to your brand and needs to be measured as an asset. New subscribers represent customers who have been moved from unaware potential customers to leads to be nurtured on your database.
By specifically segmenting and profiling these new leads to one of your buyer personas you are creating the ability to target your audience with specific and personalised content which, in turn, will move them down the sales funnel faster and lead to improved click-through and conversion rates.
KPI #2: Open Rates & Click-through Rates (CTR)
Every marketer or ESP worth their salt will give you a basic open rate or CTR for your email campaign. This report allows you to track and measure how customers are moving down the sales funnel – giving you the ability to prompt customers to a sales conversion.
CTR are important as it measures what content and call-to-actions users are responding to most favourably. If your subscribers are opening your emails but not taking action it could inform your content strategy, helping you define and refine what it is your customer wants to receive from you.
Expand your tracking to your website analytics to measure your subscribers’ behaviour on your website as well. By comparing your email report to your website analytics you will have a clear view of where customers potentially drop off to identify any barriers to conversion.
KPI #3: Conversion Rates
Conversion rates track what percentage of your subscribers have completed your sales funnel and are converted into customers. These subscribers opened your email, clicked through to your website and completed a query/ action or sale on your website.
Depending on your sales funnel or business model, sales conversions can be limited to how far you’re able to track customers. Online retailers will be able to track right to sales conversion but B2B brands aren’t able to offer instant sales given their specialised product or service offering.
Email marketing conversions could include more than just a sale. It could be a competition sign-up, qualified lead or sales appointment.
KPI #4: Earnings Per Subscriber (EPS)
Tracking your conversions can lead to tracking and determining your EPS. This KPI will help you calculate the value of each subscriber based on their interaction with your email marketing and their purchasing behaviour. Once you’ve calculated your EPS you can set a value to your combined database – giving you a monetary amount to the value of your entire database from which you can calculate a ROI for each email marketing broadcast.
For example: If you know that your average subscriber is worth R100 and your database comprises of 10 000 individuals, it would be easy to justify spending R20 per subscriber for email campaigns as you’re still making a profit. Your boss will love this!
Ready to take the first step to start tracking and calculating your email marketing ROI? Digital Fire is a full service media agency specialising in email marketing and we’re ready to help you reach your full database value and potential.
Click here to contact us and get started.
- Drip: https://www.drip.co/blog/tips-and-tactics/email-marketing-roi/
- MailMunch: https://www.mailmunch.co/blog/email-marketing-vs-social-media/