Algebra?! I'm sure that's the last thing you expected to read in a topic about email marketing. The good news is that email algebra isn't scary. In fact, in many ways it's incredibly useful and you should be employing some simple email math to make sure you aren't wasting resources with your email marketing campaign efforts. Issues like tracking which emails have been opened, which emails have bounced, and which emails have produced the most amount of clicks, are all extremely important to track. The question becomes, how do you track these things? Below are 7 very simple equations which will teach you how to track your email marketing numbers.
(Sent Emails – Email Bounces) / Sent Emails
This number is crucial to tracking how many emails that you are sending out are actually reaching people's inboxes. If you send an email to 100 people and 20 emails bounceback due to an inaccurate email, your delivery rate is only 80%. This number is one of the most basic numbers, yet one of the most important. We'll use this number in future equations.
Open to Deliver Rate
(Emails opened / Emails Delivered)
As you start to analyze more complex numbers with your emails, it becomes more important to send HTML emails to maximize the image capabilities emails have. The data you receive from the images that are present in HTML emails will tell you how many of your delivered emails are being opened and read. As a side note, some subscribers will probably have images turned off, if that's the case this metric will probably be a little lower than it's actual value.
Click to Deliver Rate
(Email Clicks / Emails Delivered)
While the open to deliver rate gives you a good idea as to whether or not your subject line is engaging enough to have subscribers open your email, the click to deliver rate tells you whether your content was engaging enough to encourage a reader to click through to your website. If your click to deliver rate is low, you may want to consider some of our previous tips on how to engage non-responders.
Subscriber Retention Rate
(Subscribers – Email Bounces – Unsubscribes) / Total Email List Size
One of the more complex equations, the subscriber retention rate allows you to monitor the rate that users unsubscribe. If this number starts to skyrocket it may be time to look at revamping your mailing list or segmenting your list to increase relevancy to subscribers.
Average Revenue per Email
(Total Revenue / Emails Sent)
This measure helps determine how fruitful your email marketing campaign has been. This rate is a strong metric to determine how successful recent promos or sales may have been received. If you offer an email promo code, compile all of the revenue made with that promo code and divide that number by the total number of emails sent for a very strong indication of how your sale was received and the average revenue each email sent generated.
Average Profit per Email
(Revenue – Campaign Cost – Cost of Goods) / Emails Sent
While revenue is a common metric that is tracked, perhaps asking how much profit each email made will help you decide if the campaign was ultimately worthwhile. Adding your campaign costs and the cost of the goods sold into the above equation will help you really examine whether or not your email campaign efforts were profitable or whether you lost money on your recent email campaign.
(Goals Achievements / Visits)
One of the more important equations, the conversion rate tells you the success of your current email marketing campaign. This number tracks the number of actions taken by subscribers after receiving the email. Was your call-to-action clear in your email? While sales are a common goal to track, some times revenue isn't the purpose of your campaign. Occasionally you may be getting users to register for a new service, or download something such as a free ebook. The conversion rate tracks the number of people who take your desired email action versus merely visiting your page.
Even if this information seems complex, don't let measuring email metrics intimidate you. While it may sound heavy, these equations are very simple to track and many services provide complete reporting and marketing solutions for organizations of any size. Check out HubSpot, our software of choice, and sign up for a free trial.