In my earlier blog, we discussed how to make your email marketing effective. Now lets see how to measure that effectiveness. There are four major performance indicators for email marketing. Lets look at what they mean and then further discuss their importance –
Open Rate – percentage of people who opened your email. Higher open rates are often governed by how interesting is your email subject line. Needless to say a higher open rate is favorable for any campaign but does not guarantee a successful campaign. However a low open rate can have multiple reasons and hence is not a conclusive metric to track the quality of your subject line. For example, if your emails are going into spam then the user may not be seeing your emails at all.Additionally, an open is counted when the recipient also gets the images embedded in the email but a lot of email clients block embedded images default thus your open rate numbers may be incorrect
Click Through Rate (CTR) – percentage of people who clicked on any link in your email. This is a better metric to track the effectiveness of your emails. Tracking this will let you know if the user is interested in the communication he was sent and clicked the link sent in the email. Measuring CTR over time will also let you know how to improve your email content over time and make it more effective.
Conversion Rate – percentage of people who actioned what was mentioned in your email. For example, for a travel website it will be the percentage of people who made a booking. This is the most important metric since this tells you if your email marketing is actually helping you grow your business or not.
Unsubscribe Rate – percentage of people who decided to unsubscribe from your mailing list. If your unsubscribe rate is higher then it clearly means your customers don’t want to hear from you or they don’t find the content you are sendingthem useful. However, a low unsubscribe rate also does not ensure a good campaign. If your emails are landing in the spam folder then the user is not even seeing them. Similarly a lot of users can choose to ignore your emails rather than taking the pain of unsubscribing from them.
Hence the safest metric to track the effectiveness of your email marketing are CTR and conversion rate. As long as they are on the right track, you don’t need to worry about any other metric.
To read about basics of email marketing, you can check my previous posts on the subject here