Email analytics

Estimated reading time: 21 minutes

One of the most attractive assets of email marketing—and one of its clearest differentiators from many other forms of marketing—is its measurability. There are many ways to measure the success of your emails, at different points through their journey—from whether they land in the inbox to if they entice subscribers to open them to whether they convert and make sales.

The wide array of stats offer a tremendous benefit, enabling you to measure how different aspects of your email are working—and to diagnose where you’re having problems. 

But… you need to know what you’re looking for.

In this lesson, we’re going to go over the most important email marketing analytics to track and understand. Don’t worry if you’re not mathematically inclined—email providers like Jilt will do most, if not all, of these calculations for you, and knowing how to interpret the results is the main thing to learn.

The 10 key performance indicators for email marketing

Open rate

Open rate measures how many people on you send an email actually open it. It’s a popular stat because, obviously, you need people to open your emails to be able to sell them the products inside those emails. Open rate is why email marketers put so much emphasis on the elements that make up an email’s inbox presence (subject line, from field, preview text).

Open rate is just an initial step in an email’s journey, but a good open rate is essential to overall email marketing success.

How to calculate open rate

emails opened / emails sent

For an even more accurate picture, you can consider one extra factor: Bounces. (Bounced emails are emails that are returned to sender for a variety of reasons, from a full inbox to a deleted email address. We’ll cover them more in depth later in this lesson.) By subtracting bounces from emails sent, you’ll get an even clearer picture of exactly how many people opened your email after it arrived in their inbox. And from this point on in this lesson, for all the metrics where it’s relevant, we’ll use the (emails sent - bounces) denominator; think of that as a quick way to calculate “emails received.”

emails opened / (emails sent - bounces)

What’s a good email open rate?

There have been a lot of studies into open rate, and while they vary a bit, they all land in the same general ballpark.

Performance

Rate

Average (for eCommerce)

16.75% (another study found 12.43%)

Good numbers

32%-35% (another study found 20%-40%)

When it comes to the numbers above, keep in mind they’re just ballpark stats. Open rates vary highly by different retail industries, different types of emails, and different send frequencies. “Good” is also fairly nebulous—as no study has quantified what percentile denotes a “good” rate. If your numbers look way lower than those broad averages, that could be a red flag—but otherwise, your best benchmark for open rates is your own history. Are your open rates trending up or down? And are you happy with where they are, or would you like to improve them more? 

What low open rate numbers mean, and how to fix them

The first thing a low open rate points to is: You aren’t properly catching subscribers’ attention in your inbox. Maybe your subject lines and preview text aren’t enticing. Maybe you shouldn’t just use your business name for your from field, you should describe what your business does as well.

But beyond struggling inbox content, a low open rate can also be tied into your frequency and timing, as we discussed in our lesson on scheduling. Are you sending too much—or not enough—and it’s hurting your open rate? And have you tested the best days of the week and times of the day to send to get your subscribers opening and clicking?

An absence of personalization and segmentation can be another cause of a low open rate. While you may not want to put someone’s name in the subject line, as that’s a potential turn-off, if you’re presenting offers and content that are more relevant to a subscriber, they’re more likely to open. A study found personalized subject lines had 26 percent higher open rates, and another study found segmented subject lines had 14 percent higher open rates.

There’s more to personalization than just using someone’s name—for instance, including data from the customer’s purchase history and cart contents are both also forms of personalization.

Finally, low open rates could be the result of a list in need of cleaning. If you have lots of inactive or lapsed subscribers—people who are essentially done engaging with your brand—they should be purged from your list. Once they’re gone, you’ll be measuring only your active, engaged customers, which means data like open rate will be more accurate.

Click-through rate (CTR)

Click-through rate measures how many people clicked a link in your email. It’s one of the most tracked and thoroughly examined email marketing metrics, because it’s a simple, clear way to see if your emails are working. If your emails are getting people to click through to your site, they’re doing their job. (It’s your site’s job, then, to close the sale.)

How to calculate click-through rate

total clicks / (emails sent - bounces)

You can also take this formula a step further and track unique clicks—i.e., how many different people clicked through your email. That removes people who might click on your email more than once, which can skew the results and give you an inaccurate picture of effectiveness. (In an extreme example, let’s say you send an email to 1,000 subscribers. You have one very indecisive customer click your email 200 times, and 20 other people who click once. The simple CTR formula would show a click-thru rate of 22 percent. Using a unique click-through rate, that person would only be counted as one unique click, which will give you a more accurate rate of 2.1 percent.)

total unique clicks / (emails sent - bounces)

What’s a good email click-through rate?

Average click-through rates aren’t nearly as high as open rates. When you look at these numbers, you’ll see why you need to grow your list with high-quality, engaged subscribers—if you can only count on, roughly, a two percent click-through rate, it’s going to take a lot of subscribers to get a significant volume of customers to your site.

Performance

Rate

Average (for eCommerce)

Good numbers

6%-7% (another study found 15%)

What low click-through rate numbers mean, and how to fix them

The first thing to look at if your click-through rate is low is what you’re offering in your emails. Is your value proposition good enough? Does it meet the needs of your clients and fill a void that’s missing in their lives? And are you making it clear how what your selling accomplishes all of that? Take a hard look at your content and your offers and make sure they’re enticing and captivating—if you were a customer, not the business owner, would you want to click on those offers?

Another area to examine is your calls-to-action. Do you have a small number of calls-to-action in your email, or are you overwhelming people with too many, perhaps causing decision fatigue? Is it clear what action you want a customer to take? Check out our suggestions in previous lessons on call-to-action button design and content to create prominent, effective calls-to-action that elicit clicks.

And, much like a low open rate number, a low click-through rate can be a symptom of generic, non-personalized content. A few studies have found monumental differences in the click-through rates between segmented and non-segmented emails. One found unsegmented emails had a 3.4 percent click-through rate—segmented emails hit 38.8 percent. And another found the click-through rate was 65 percent higher for segmented emails than non-segmented ones.

Click-to-open rate (CTOR)

Click-to-open rate is a more advanced metric that, essentially, combines and helps contextualize the previous two stats. It measures how many people opened your email and then clicked through to your website.

As a result, it gives you a better big picture look at the overall efficacy of your email marketing. It also gives you a very good picture of the effectiveness of your content, more or less eliminating potential statistical noise—it’s specifically telling you how many people were swayed by your content to click through after they opened your email.

How to calculate click-to-open rate

unique clicks / unique opens 

The number you’re getting from this CTOR formula is a ratio of clicks to opens. If everyone who opened your email clicked through (say, 500 clicks on 500 opens), your CTOR would be 100 percent. If no one who opened your email clicked through (say, zero clicks on 500 opens), your CTOR would be 0 percent.

What’s a good email click-to-open rate?

There haven’t been many studies into click-to-open rates, certainly not compared to the other main email metrics. However, one major study found you should be quite pleased if somewhere between one in three and one in five people who open your email wind up clicking through.

Performance

Rate

Good numbers

20%-30% for broadcast, 30%-40% for automations

A good CTOR indicates your inbox presence is enticing, your email content is compelling and delivers on what your inbox presence promises, and your call-to-action is effective.

What low click-to-open rate numbers mean, and how to fix them

A low click-to-open rate most likely means the content inside your email didn’t close the deal or fulfill the promises you made in that subject line. In those cases, examine the fixes we discussed above in the click-through rate section: Better content, stronger and clearer calls-to-action, and personalization and segmentation.

A high click-to-open rate seems like a good thing, but there is one red flag scenario—and to find that out, you’ll need to also look at your email’s open rate results. If your open rate is average or above, and your click-to-open rate is high, that means you did a great job on the email: Great inbox presence, great content.

But if your open rate is below average and your click-to-open rate is high, that can mean one of two things (or both of these things). One, you need to clean your list to remove unengaged subscribers—because the people who actually are engaged are opening and clicking your emails. Or two, your inbox presence was off, but the content in your email was good. (If that’s confusing, think about it this way. If only two percent of people opened your email, but 90 percent of them clicked through, you’d have a spectacular click-to-open rate—but clearly it’s not good that your open rate was so low. Just imagine if you purged inactive subscribers from your list, and worked on your subject line, preview text, and from field—your open rate could jump next time, exposing way more of your subscribers to your effective content.)

Bounce rate

Bounce rate measures the percentage of emails you sent that couldn’t be delivered—so they “bounced.”

There are two types of bounces you’ll encounter. Hard bounces are email addresses that are invalid or have been deleted—those should be purged from your list immediately as their ongoing presence can be a sign to email clients like Gmail that you’re sending spam. Soft bounces are emails that are returned to you because the addresses still exist but are currently having a problem, like a full mailbox or email server issues. You don’t want to purge those soft bounces immediately, but you do want to keep an eye on them—and if the problems aren’t resolved expeditiously and your emails to those addresses continue to bounce, then they should be purged like the hard bounces.

Jilt automatically suppresses emails that have hard bounced.

As we discussed in our lesson on deliverability, bounces are one of the top factors in determining your sender reputation—too many bounces, and your reputation takes a hit. Plus, you don’t want to send emails to addresses that aren’t working; while each individual email doesn’t cost a lot to send, if your list is packed with undeliverable addresses that bounce, they’re unnecessarily inflating your expenses.

How to calculate bounce rate

total bounced emails / total emails sent

What’s a good bounce rate?

The best bounce rate would be zero percent, but that’s fairly unrealistic—at the very least, a few tricky spambots will slip past your defenses, wind up on your list, and cause bounces. What’s the endgame for building spambots that sign up for email lists with fake email addresses just to have the emails bounce? We have no idea.

Performance

Rate

Average (for eCommerce)

0.24% hard bounces, 0.3% soft bounces

Cause for concern

Above 2%

What high bounce rate numbers mean, and how to fix them

High bounce rate numbers are a sign that your list needs maintenance and attention. It could mean you’re not purging dead emails and inactive subscribers frequently enough—or it could mean you’re not sending enough emails, which is why there’s so much turnover in your subscribers between sends.

The fix is to set up a regular list maintenance schedule. Set up automated win-back campaigns to try to re-engage lapsed subscribers after a certain period of inactivity (60 days, 90 days, or whatever you feel is right for your business), and purge those that don’t respond. And if you’re sending sporadic emails (think less than once every few weeks), consider upping your frequency a bit to keep your list from atrophying and filling up with zombie email addresses.

Unsubscribe rate

The unsubscribe rate measures how many people choose to unsubscribe from your list after a given email. As we’ve discussed before, not all unsubscribes are bad—you want people on your list who want to be there—but, obviously, you don’t want too many. And, above all, you don’t want good customers unsubscribing from your list.

How to calculate unsubscribe rate

total number of unsubscribes / (emails sent - bounces)

What’s a good unsubscribe rate?

It would be pretty demoralizing to send an email and see a huge rush of people unsubscribing right afterwards. Fortunately, the numbers suggest that’s probably not going to happen.

Performance

Rate

Average (for eCommerce)

Good numbers

Less than 0.5%

Cause for concern

Above 0.5%

What high unsubscribe rate numbers mean, and how to fix them

If one individual email leads to a huge spike in unsubscribes, that most likely signals an anomaly—and could be the result of something wrong with that particular email. Does it have a glaring and unprofessional typo? Was there a sending glitch where it went out multiple times? Did you attempt to personalize it, but through an error in the process, everyone instead got an email that said “Hey {{ customer.first_namm }}?

A one-time spike in unsubscribes, while upsetting, isn’t an indication of long-term or nagging issues with your email marketing. It’s just a reminder to proofread and test—no matter how long you’ve been doing this for.

If your emails are consistently registering above-average unsubscribe rates (above that 0.5 percent line of demarcation), that is an indication there’s a chronic problem with what you’re sending. You can check out our lesson on unsubscribing for more detail on what that chronic problem or problems might be. But, in brief, here are some of the key reasons why your unsubscribe rate is higher than you’d want.

You may be sending the wrong frequency. Too many emails can boost unsubscribe rates, and so can too few—it’s common to get a spike of unsubscribes when you send an email to a list that hasn’t heard from you in weeks or months). Examine your frequency and see what happens if you change your cadence.

Are you being too aggressive with asking for things and giving the impression you’re only focusing on your needs, not your customers’ needs?

Another possible reason is your subscribers aren’t getting value from your emails anymore. Are you delivering what you promised when they signed up, and what they’ve grown to expect over time on your list? And do you always have a good reason to send every email, or are you just sending emails for the sake of sending emails? Are you being too aggressive with asking for things and giving the impression you’re only focusing on your needs, not your customers’ needs?

And high unsubscribe rates could also indicate your emails aren’t relevant to your customers which, again, leads back to making sure they’re tailored to your unique subscribers. A study found segmented emails have a nine percent lower unsubscribe rate than non-segmented ones.

Complaint rate/spam rate

The complaint rate calculates how many people report your email as spam. The major email clients all have a little “mark as spam” button, and if enough people hit that, it can be devastating to your sender reputation and deliverability. If it gets too high, your email provider might even cut you off. In other words: If you see red flags starting to pop up in your complaint rate numbers, you need to act fast.

How to calculate complaint rate

spam reports and complaints / (emails sent - bounces)

What’s a good complaint rate?

This is the case where you hope your rate is zero percent—and, if you keep a clean list and send high-quality emails, you may very well see zero percent complaint rates on many of your emails.

Performance

Rate

Average (for eCommerce)

Good numbers

Less than 0.1%

Cause for concern

Near or above 0.5%

What high complaint rate numbers mean, and how to fix them

Why would someone subscribe to your list but then mark your emails as spam? Here are some of the major reasons, and ways to try to rectify them.

If you’ve recently upped your send frequency, and your subscribers weren’t ready. If you want to ramp up your frequency, do it slowly and gradually—you don’t want a customer to have a moment where they say, “What’s with all these emails from these people all of a sudden, it’s too much” and click spam.

Subscribers don’t know or remember how they got on your list. This is why you need to make it clear when people opt in to your list. That includes an active subscription process on check out—where a customer has to check a box to subscribe to your list, not uncheck a box to avoid subscribing. The “don’t know/remember” scenario can also come up if you aren’t sending frequently enough. If it’s been three months since you sent an email, there’s a chance some people won’t remember their one random visit to your eCommerce store months ago and click the spam button. You can also consider adding a line at the bottom of your email telling recipients why they’re receiving the email—and possibly even the date they signed up.

It’s easier than unsubscribing. Legally, you need to make it clear in your emails where someone can click to unsubscribe—but if it’s in the footer in light gray text and someone doesn’t see it quickly as they scroll to the bottom of your email, they might click “mark as spam” instead. They also may use the “mark as spam” button if they click the unsubscribe link and, rather than going right to an unsubscribe page, it takes them to a page requiring them to log in to their account before they can leave your list.

If you obscure your unsubscribe link, it can lead to more people marking your email as spam.

Your emails aren’t instantly recognizable. If you use a name in the from field that someone doesn’t recognize along with a subject line that also fails to jog their memory, they might think you’ve sent them spam. Likewise, if your inbox presence comes off as spammy, with spam trigger words in your subject lines, your subscribers might interpret your emails that way. One step toward keeping your emails recognizable is, yes again, personalization and segmentation. If your emails contain something directly relevant to the subscriber, it can help avoid the spam button—a study found segmented campaigns had 5.74 percent lower complaint rates.

Your emails actually are spam. That means: If you buy an email list, rather than building up your own, get ready for the spam complaints to fly.

List growth rate

List growth rate measures how fast your email list is growing. You want the number going up or, at the very least, holding steady. If it starts decreasing—meaning you’re losing subscribers faster than you’re gaining them—that can be a worrisome trajectory.

Unlike all of the previous stats covered in this lesson, list growth rate isn’t something to measure on an email-by-email basis. Instead, you’ll want to calculate it monthly, which gives you a good picture of how things are going.

How to calculate list growth rate

((number of new subscribers) - (number of lost subscribers)) / total subscribers

The number of lost subscribers is based on the sum of unsubscribes, bounces, spam complaints, and purges. 

The list growth rate formula basically shows that you need your new subscribers to outnumber your lost subscribers each month—or else your growth rate will be negative.

It can help to illustrate this with some round numbers for clarity. Let’s say, in January, you gain 100 subscribers and lose 50 to unsubscribes, bounces, spam complaints, and purges. And your total list size at the end of the month is 500. That makes your January growth rate 10 percent. Now in February, you gain 200 subscribers and lose 50. So at the end of the month, your list size is now 650. That makes your February growth rate  23 percent. But then March comes, you gain 100 subscribers and lose 50. At the end of the month, your list size is now 700, but your growth rate went down to seven percent. Growth rate goes up when you are making steady gains in your subscribers and/or losing fewer people on your list, and your gains continue to grow as your list continues to grow.

While monthly data can give you a good indication of how you’re doing and help you spot troublesome trends early, if you find it’s overkill, you can also easily calculate your list growth at the end of a year.

(number of subs at end of year - number of subs at beginning of year) / number of subs at end of year

In that case, if you started the year with 200 subscribers and ended with 800, your annual growth rate would be 75 percent. So to top that, the next year, you’d need to end up with around 3,300 subscribers to beat your growth rate. 

What’s a good list growth rate?

According to one widely-cited study, email marketing lists lose about 22.5 percent of all their subscribers every year. So knowing that you’re going to lose about a quarter of your list every year, you’ll need to grow at a higher rate than that just to break even. 

While there haven’t been any major studies into good growth rates, it’s also worth noting that a study found the average email opt-in rate is 1.95 percent—meaning about two out of 100 people who visit your site join your list. A good rate is three percent, and an elite rate is 4.77 percent.

What low list growth rate numbers could mean, and how to fix them

There are two major components to list growth: Gaining subscribers and losing subscribers.

If you’re seeing deficiencies in gaining subscribers, examine your list building techniques. We cover them extensively in our lessons on building your list—things like on-site sign-up forms and incentives can go a long way in keeping your numbers strong.

If your bigger problem is losing subscribers, check out our suggestions earlier in this lesson in the sections on bounce rate, unsubscribe rate, and complaint rate for keeping subscribers on your list and happy.

Email sharing and forwarding rate

If you’re creating really good emails, your subscribers might even forward them along to their friends. You can’t expect it to happen that much, as it’s not that common of a user behavior—plus, odds are, the call-to-action in your email isn’t encouraging someone to forward, it’s encouraging someone to make a purchase. However, your sharing and forwarding rate can build your list, increase your sales, and show you how you’re doing at turning customers into brand advocates.

How to calculate email forwarding rate

total clicks on "share this email" link / (emails sent - bounces)

What’s a good email forwarding rate?

One study on forwarding found 95 percent of brand emails were forwarded to at least one person. But, on average, it won’t be forwarded too much—the numbers below show an average of one forward for every 370 emails delivered.

Performance

Rate

Average (for eCommerce)

0.27%

Good numbers

0.65% (with an elite rate being 4.8%)

What low email forwarding numbers mean, and how to fix them

One of the top impediments to sharing is… not giving people a “share with a friend” link. While it might not be (and probably won’t be) your primary call-to-action, having a “share with a friend” link or button can get results. Two separate studies found that emails with clear, noticeable sharing calls-to-action were 13 times more likely to be shared than emails without.

You also want to send (at least some) emails with sharable content. The most forwarded emails in those studies were about events, news or helpful content, exceptional deals and promotions, new products or services, seasonally-relevant products, and charitable causes.

And, relevant, segmented emails are better for sharing. One of the above studies found segmented emails were shared 90 percent more than non-segmented ones, and personalized emails were shared 450 percent more. And the other study found that among the emails with the absolute highest share rates, around a quarter of them were segmented or personalized. Our theory why? People tend to be close to others who are similar to them in some way: Same geographic location, same hobbies, same industry, etc. So a segmented email to one person is probably going to be relevant to many of their close connections as well.

Conversion rate

Conversion rate is a metric you’re going to want to pay close attention to because, ultimately, it’s the goal of your email marketing: Driving your subscribers to take an action, which, most of the time, is making a purchase. Your conversion rate tracks how many people clicked through your email and then made a purchase (or did whatever else you wanted them to do in the email, like filling out a survey, joining a VIP club, leaving a review, or anything else). Conversion rate just might be the one metric that truly shows you the success or failure of your email marketing efforts—if your emails are generating a good conversion rate, they’re successful. 

How to calculate conversion rate

number of sales or actions taken / (emails sent - bounces)

Basically, you’re looking at how many successful emails you had out of the number of emails that were delivered. 

What’s a good email conversion rate?

One study found the average conversion rate for eCommerce industry emails was 2.63 percent in the U.S. and 2.86 percent globally—although some of the best performing stores saw conversion rates above 5 percent. Another study found the average conversion rate was 1.48 percent.

A third study broke things down and found conversion rates vary by type of marketing email. Here are their results:

Email type

Conversion rate

General broadcast

1%

Order follow-up (including sales emails like replenishment reminders and non-sales emails like review requests)

5%

Win-backs

2.6%

Cart abandonment

5%

Welcome series

2.7%

So from all of this, we see that you’d want a conversion rate that’s definitely above one percent across all types of emails—and preferably above 2.5 percent.

What low conversion rate numbers mean and how to fix them

There could be a number of factors contributing to low conversion rates, and they could be happening at different steps of the process.

The first place to look is your emails. Are your open, click-through, and CTOR numbers average or below average? If people aren’t opening your emails and/or aren’t clicking through to your website, it could hurt your conversions—you simply aren’t getting enough people to visit your site to make a significant number of sales. If this is the case, re-think your content and the nature of your offers. Make sure you’re sending emails that entice clicks and give your subscribers a real incentive to click through and take action.

If your other email statistics look good but you’re still having conversion rate issues, then your issue may lie within your website.

Do the offers on your site match what you’re promising in your email? Is your site optimized well, with a smooth checkout process—on mobile as well as desktop? While eCommerce site and cart design are beyond the scope of this lesson, a low conversion rate is a suggestion that you need to re-examine your site’s content, design, and checkout flow.

To that end, think hard about where a customer winds up when they click through from your email. Are you deep linking to the right place—e.g., if they clicked on a specific product, are you taking them directly to that product’s page? And have you considered taking them to a dedicated landing page, one that’s designed and optimized to continue the narrative of your email and make the specific sale? One study found the average landing page leads to a 2.35 percent conversion rate, and the top quartile of landing pages convert at over 5.3 percent.

Independent of email content and site design, one other way any store can improve its conversion rate is by sending more automations. The stats above show automated emails like welcome series, cart abandonment campaigns, and win-back emails perform at significantly higher rates than general broadcast emails. We covered all of those emails in our automations lesson but, for the purposes of this lesson on analytics, the stats show that automations convert better—so it would stand to reason that more automations equals a better conversion rate and more revenue.

A close cousin of conversion rate is attributable revenue. Jilt tracks attributable revenue from email so you can see exactly how much money your emails are bringing in (and also calculate your email ROI). When a customer opens or clicks any Jilt email, then places an order within a few days, that purchase is attributed to the email.

Overall email marketing return-on-investment (ROI)

Email marketing isn’t free. Even if you’re doing all the design and writing yourself and not hiring anyone to handle it, there’s the cost of your time (both what your time is worth, and the opportunity cost of you focusing on email marketing and not something else). Plus there’s the cost of sending emails through your email marketing platform, advertising costs associated with building your list, and the cost of any number of other apps you’re using for things like address collection, landing pages, A/B testing, and more.

However, email marketing is a top priority for countless eCommerce companies because it can be so lucrative. You need to know that the amount of money you’re investing in your email marketing efforts are paying off—and that’s where return-on-investment comes in. When you know how much revenue you’re bringing in for what you’re spending, it lets you know whether to scale up your spend or scale down.

How to calculate your overall email marketing ROI

(revenue generated by email marketing - money invested into email marketing) / money invested into email marketing

You can calculate your email marketing ROI over different time frames—from a single email campaign to monthly to annually to lifetime. A single email campaign probably isn’t going to give you a great picture. A month is a good time frame to start with, however, calculating across a quarter or half a year may give you a richer sample of data to provide a more accurate indication of what your ROI really is.

What ROI numbers are good?

There are really two stats on email marketing ROI you’ll find cited in countless articles online. And they are: 3,800 percent and 4,400 percent. Those translate to $38 dollars per $1 spent and $44 for every $1 spent. And those two stats, above any others, will tell you why email marketing is so important: $38 to $44 for every $1 spent in marketing is a seismic, transformative return-on-investment.

Will you hit those numbers? You might. As we’ve seen in previous lessons, there’s so much more to a comprehensive email marketing strategy than slapping one sign-up form on your site and blasting out a sales email once a week.

The study that found an average ROI of 3,800 percent, or $38 for every $1 spent, also broke down the rest of the bell curve. Around half of companies did worse than that number, for what it’s worth—including the bottom 20 percent of companies, who saw an ROI of $1 to $5 for every $1 spent.

On the bright side, the study didn’t find any companies losing money on email marketing—so, based on these numbers, the worst case was breaking even. And on the even brighter side, lots of companies in the study outperformed the $38-for-$1 ROI. More than 45 percent of the companies had an ROI above $41 for every $1 spent—and that includes 18 percent of companies that saw an ROI above $70 for every $1 spent.

Distribution of ROI for email marketing.

What low ROI numbers mean, and how to fix them

The diagnosis process for a low ROI is similar to that of low conversion rate—you can use the other metrics in this lesson to figure out where your problem lies. A low open rate means you need to work on your inbox presence to get more people opening your emails. Low click-through rates mean your content and offers aren’t meeting expectations. A low conversion rate can mean there are issues with your eCommerce site itself that are impeding the sales process. 

Beyond that, there are some other things that could be causing a lower return-on-investment than you’d want. You may have disproportionately high costs because of a large list—one that could use a purge of inactive and lapsed subscribers. You may be paying for expensive apps and tools that exceed your current needs. You may be paying for content creation or email design services that are gratuitous at your current level. Scale up appropriately as your email list grows and you won’t have an unnecessarily low ROI during your growth phases.

Reduce your ancillary email marketing costs to increase your ROI.

ROI also ties back to segmenting. On average, companies say 58 percent of their email marketing revenue comes from segmenting. Relevant offers convert better than irrelevant ones. 

Summary and implementations

Summary

Email marketing is extremely trackable, at virtually every step of the process, which is great for recognizing what’s working and what’s not. The measurability also can guide your decision making on your budget for acquiring subscribers and investing in your email marketing efforts.

There are 10 key performance indicators, all of which give you insight into a different facet of your email marketing.

Open rate tells you what percentage of people are opening your emails. A below-average open rate suggests there’s a problem with your inbox presence (subject line, from field, preview text) or perhaps your send frequency or list hygiene.

Click-through rate measures how many of your subscribers are clicking through in your emails. Low numbers can indicate there’s a problem with your content, the types of offers you’re making, or your calls-to-action.

Click-to-open rate combines the previous two stats by calculating how many people who open your emails then go on to click through. A low CTOR suggests you have a strong inbox presence but the content inside your emails isn’t enticing clicks. A high CTOR can indicate you’re doing well on both inbox presence and email content. But if you have a high CTOR and low open rate, it can indicate your email content is good but your inbox presence needs work.

Bounce rate calculates the number of your emails that couldn’t be delivered. It’s important to keep your list clean and purge addresses that are bouncing expeditiously, as a high bounce rate can negatively affect your sender reputation.

Unsubscribe rate tells you how many people unsubscribe from your list after a given email. A huge, outlier spike can indicate a problem with one individual email, while a consistent above-average rate can be linked to a more chronic problem with your email marketing strategy.

Complaint/spam rate is the percentage of people who mark your email as spam, which can be devastating towards your sender reputation. You may see spikes in your complaint rate if you suddenly increase your sending frequency—or if you send so little that people forget about you and forget that they once subscribed. You may also see a spike if it’s difficult to unsubscribe from your list.

List growth rate calculates how fast your number of subscribers is growing. You want to keep building your list and replacing people who leave (which is approximately 22.5 percent of subscribers per year), so if your list growth rate isn’t great, consider your building strategies.

Sharing/forwarding rate shows you what percentage of subscribers are clicking a “share/forward” link in your email to send it to a friend. Make sure you have that link in your emails, and good, relevant content is always the most shareable.

Conversion rate tells you how many people made a purchase (or took another desired action, like leaving a review) from your email. Low numbers can indicate problems with your email content or issues with the purchasing process on your eCommerce site itself.

Return-on-investment is the final KPI, which lets you know how well your efforts into email marketing are paying off. Two highly-cited stats on email marketing show an average ROI between $38 and $44 for every $1 invested—that makes email marketing extraordinarily lucrative if you can hit those same thresholds. If you aren’t, look for ways to cut costs, diagnose where you’re having problems (opens, clicks, conversions?), and segment and personalize to send more relevant emails.

Implementations

Step 1: Calculate the most important stats

  • The first stats get an accurate read on are bounce rate and complaint rate, as those are problems that need to be addressed immediately, and can impact your deliverability if they aren’t taken care of quickly.
  • Compare your other stats (like open rate and click-through rate) to the industry benchmarks in this lesson. If you see a major difference, that could be a sign something with your email marketing needs to be reassessed.

Step 2: Make an ongoing tracking plan

  • Make a plan to do weekly or, at least, monthly calculations on the other KPIs.
  • Analyze your numbers and compare them to the averages in this lesson. Look for anything that stands out negatively, and diagnose your problems. 
  • Watch for trends in your own numbers. While industry benchmarks are good, you want to see growth and improvement in your own numbers based on your unique audience and sales proposition.

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