I am a metrics person. I believe that if you don't know where you are going you won't get there and if you don't measure your successes you can't win. Email marketing is one of those areas of marketing that you would think would be easy to create metrics for. However, I believe we generally do a SOUR job of this based on my experience.
Since these are internal measures, my commentary will be around what these are and should be, what we all should care about and how to set up some good dashboards and metrics to allow for understanding and continual improvement.
First, what are some of the standard metrics that are bandied about in email marketing?
Sent Emails
Delivered Emails
Open Rates
Click Through Rates
Unsubscribe Rates
Bounce Rates (hard and soft)
Other less used metrics include:
Inbox Placement
Earnings Per Email (click or open)
Conversion Rate
Complaint or Abuse Rate
Forward Rate (sharing rate)
Churn Rate (or list growth rate)
ROI
Seems like a lot and some of these are not very well understood and are treated differently in the ESPs. Let's take a brief look at each.
Sent Emails - When you hit the "send" button, the number of attempts or the number of emails in your list. While this metric is important, it is of limited value in understanding the performance of your campaigns and can be problematic if you have poor list hygiene or sign up processes. For example, if you have invalid formats or old email addresses in your list, this metric could be misleading. However, it is needed to calculate a delivery rate and warn you of any problems in that area.
Delivered Emails - This is the total number of emails that actually land in someone's inbox. It does not tell you where in the inbox and without the "send" figure to calculate a rate of deliverability, it is of limited value. It should be tracked and trended however to insure you are not getting caught in spam filters or black listed. Be sure to dive deep and look at this metric by ISP as it can help you diagnose if and where you might have deliverability problems and how to fix them.
Open Rates - While important to measure and trend, this metric can be misleading mostly because quite a few people read emails in preview pane and never open them. Different ESPs may also measure open rate differently, for example based on images downloaded, but if these are done automatically, it may record an open even if the reader didn't look at the email. Text emails may be excluded from open rates also. It is a good directional indicator of engagement and awareness of your communications however. Be aware and be sure you understand exactly how your ESP measures and reports this.
Click Through Rates - This metric is often spoken of as a highly important one, however, it is totally in the marketers control and without context really tells you nothing. If you measure click through rates, be sure to include a metric on click through opportunities. Any one email could have no click through opportunities or ten. If you do not have an understanding of that, you won't have a true measure of success. When creating reporting templates, be sure to include a field for the click opportunities in each email and then you can categorize click through rates based on that percentage versus just an overall percentage that does not speak to if the reader could have clicked. Also look at where the click through was - did they click on your logo, on a particular piece of content, or on more than one occasion.
Unsubscribe Rates - This is a must have metric that does a good job confirming you are not a SOUR emailer. ESPs typically do a good job of capturing this as it is triggered by a direct action from the email recipient. This can be manipulated as well by you based on how you handle the unsubscribe process. If you make it difficult for people to unsubscribe (as I have addressed in an earlier post), you may be under representing the sentiment. Also, if you have failed processes, you may be over counting. For example, my favorite SOUR emailer Younkers, as I mentioned in a previous post, has received numerous unsubscribe requests from me as it didn't appear to be working and I continued to receive their emails even though I asked them not to send. I will report that I have finally quit receiving their emails (for now). I wonder if they saw my post and finally did something about it!
Bounce Rates (hard and soft) - This is another metric that could be different based on how your ESP handles it. Some will count a hard bounce after a send has failed three times, but some may allow you to control how often the fail has to happen to count as a hard bounce. Soft bounce means the delivery was temporarily not available, but again can be altered. Be sure you understand exactly how your ESP handles these and measure appropriately. If you have a high hard bounce rate, you can also put yourself in a position of having your emails blocked by ISPs as being SOUR and on the verge of SPAM, so be sure to watch these rates closely to stay on those white lists and not be a SOUR emailer.
Secondary Metrics:
Inbox Placement - This is a lesser used metric, but as the ISPs get more aggressive at filtering and automatically moving incoming emails (especially Gmail), your well crafted message may never even receive the opportunity for the recipient to see if it is placed into a sub-folder without the email owners knowledge. It is difficult to combat this as well since like SEM algorithms, it can be ever changing and different based on the ISPs practices. At least be aware of this and attempt to understand if you are doing things that are making your emails more likely to land in the wrong place.
Earnings Per Email (click, open, delivered) - Getting to the heart of why we email, we should be measuring what we get out of these programs. While for some, this may be difficult, if you can, try to tie your actual revenue creation to the email function. Use the base metric that works for you (delivered, opened or clicked), but do attempt to do so. This may require extra work in Google Analytics and your CRM system to properly tag and add parameters to your campaigns, but it will be well worth it. Also consider what role emails play in the customer journey and how to tap into that. One thing I saw in my last role is that Google Analytics was showing us huge numbers of "direct" traffic to our website. We knew we didn't have that high brand recognition to warrant this and after digging in realized that we were not fully capturing the impact of our email programs to reactivate and engage our prospects in our products and ultimately purchase. Having the proper attribution allowed us to better prioritize our overall efforts and leverage our resources more effectively to the highest return activities.
Conversion Rate - Like earnings rate, this is another good metric that attempts to tie your end goals to the email function. It can be measured in several ways, but the goal is to understand of those receiving your emails, who is taking the revenue generating action you desire, be it an e-commerce transaction, an appointment or some other metric. It is different from the earning metric as it measures against people or recipients rather than a volume figure such as earnings. Pick the measures that mean the most to your business results.
Complaint or Abuse Rate - Similar to unsubscribe rates, these rates are more problematic to your future as they are signals sent to your ISP about you that can cause you to become black listed. Obviously if someone is at the point of angst that they are communicating to someone other than you about your SOUR email, it spells trouble. ISPs also facilitate this differently, so look at it by provider to see differences and identify opportunities for improvement.
Forward Rate (sharing rate) - Another metric totally in your control as if you don't provide the opportunity for the forward, there is nothing to measure. Ask yourself how you can use email, like you use social media, to engage your best advocates in continuing your message. While this is another topic and subject for marketing improvement, if you do this, measure and trend to find easy wins.
Churn Rate (or list growth rate) - Are you adding new net prospects or is your list stale? This metric will help you understand where you sit and what you need to do to continue to grow your opportunities and fill the top of the marketing funnel. If you have a product with a long sales cycle time, this can be an especially important metric for long term forecasting and growth. Measure how many new email addresses are added to your prospect list after you remove unsubscribes, complaints and hard bounces.
ROI - The ultimate goal of all businesses and marketers - how much did you put in and how much did you get out. Email marketing has been proven to have one of the highest return on investments of all marketing tactics. Are you measuring this and trending to insure you improve and grow with this valuable tool? Again, dependent on your business, attempt to tie directly created revenue to costs which include ESP fees, expenses of content and list development and team costs.
Today's Tips for Better Email Metrics:
- Be thoughtful and insure you fully understand the nuances of the metrics you choose to use
- Select the metrics that will insure ongoing success (unsubscribes, ROI, etc.) and allow for insights and actions and relentlessly track
- Be sure to trend metrics over time; watch for seasonality (retailers especially) and other market conditions that can impact these; most ESPs publish standards and averages at least for things like open and click through rates, so reference those to benchmark how you are doing.
- Sub-segment emails by types and categories and understand what the trends are. It is entirely reasonable to expect 90%+ open rates from certain transnational emails, but far less from others. If you aren't creating segments of emails by type and tracking you will miss problems and opportunities to improve.
- When looking at your statistics in totality, think about the blend of types of emails and take that into account. You may pat yourself on the back for a big improvement in open rates in a month where perhaps your volume of promotional emails was lower as a percentage of total emails. It may be that you actually had a problem that was masked because your data wasn't granular enough to obtain a complete understanding.
- Consider a deliverability audit for a deep dive into where and how your emails are being delivered to unmask any issues.
- Watch for any red flags that can get you on a black list. Once you are on, it is very difficult to get off, so make this a top metric.
Overall, email metrics can insure you invest wisely, learn as you execute, continue to improve and drive notable revenue from this valuable channel. Take the time to build a strategy for you email metrics just like you do for marketing and email overall and put the tools and resources in place to support the channel. Don't have SOUR email metrics and missed revenue!
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