5 Email Marketing Metrics Every Ecommerce Business Should Track
Every right decision in e-commerce is based on valid metrics.
The most successful businesses understand their online store's performance and know which areas they need to improve in order to grow.
Email marketing is definitely one of the cheapest and most convenient ways to communicate with your prospect and loyal customers.
But it is only effective if the recipients are engaged and responsive to your messages.
This is why it’s important to measure the performance of your email campaign to see if we are actually achieving our goals or not.
In this article, we are reviewing 5 crucial email marketing metrics that most affect revenue for eCommerce businesses.
Here’s what we covered:
The 5 metrics
Open rate
Click-through rate
Conversion rate Bounce rate
Unsubscribe rate
Conclusion
Between thousands of possible KPI's, there are 5 metrics every e-commerce business owner should track to fully understand the performance of their email marketing campaigns.
Open rate
Your open rate is one of the first and most important metrics to measure.
It simply determines how many of your emails have been opened, and directly shows the performance of your subject line.
Besides, the email open rate can help you understand if you are targeting the right audience and if your emails reach their inbox (and not spam folder).
21.33% is the average email open rate but the numbers differ by industry:
To calculate the email open rate, you should divide the total number of tracked open emails by the total number of delivered and multiply it by 100.
Many email marketing platforms if not all show you what your campaign open rate is. In Klaviyo, it’s this column:
Segmenting your email list and creating different campaigns for your customers based on their purchase behavior, is one of the high-level things you can do to improve your open rate.
But here are 3 simple ways you can begin to improve the open rate of any email campaign:
Use short and personalized subject
The subject line should be personalized, not too "salesy" and most importantly – short. Use the name of the person in the subject or opt for an eye-catching phrase that drives attention.
Nearly 70% of users check emails on their mobile phones, therefore make sure it is shorter than 90 characters – ideally 6-10 words. Emails with the highest opening rate include words as "secrets", "e-sales" and "awesome" in the subject line.
Choose the correct time
Research from Get Response suggests the best day to send emails is Tuesday.
When determining a good time to send emails, consider who your audience is – take a look at the bottom graph that segments the opening rate by day and industry.
Receivers are most likely to read emails that arrive at 10 am and 1 pm.
Avoid being marked as spam
Sending you an email campaign from a good IP address and through verified domains is not enough to make sure your message does not land in the spam folder.
Increase your chances by using merge tags in the "To" field and avoiding extremely sales-oriented language (f.e. "buy", "clearance", "discount", "cash").
You can also guide your subscribers on how to whitelist your emails, and ask them to add you to their address book.
2. Click-through rate
Measuring the click-through rate (CTR) is important to understand how many of your subscribers are engaging with your email campaign and click on the link in the email.
The average click-through rate for email campaigns is 7.77% - and it increases by 14% if the subject line of your email is personalized!
The CTR metric is closely connected to the conversion rate on your online business – if the click-through rate is high, the conversion rate should be high as well.
73% of online marketing specialists define the success of an email marketing campaign by its click-through rate.
When calculating the CTR, you should divide the number of clicked emails by the number of sent emails minus the number of bounced emails, and multiply it by 100.
You can measure the unique clicks through your email and see how many of your recipients clicked on the link, or all link clicks, in which you will count multiple clicks on the link from one of the recipients.
Optimizing your email campaigns for mobile users can increase the CTR by 15%. If your click-through rate is lower than 7%, try to:
Segment your email list
Segment your subscribers by their purchasing behavior and send them personalized emails.
For example, you can target new subscribers with the most popular products or offers.
While you could send emails with similar products to their last purchase or loyalty offers to those who have already bought.
Personalizing emails can increase CTR by 139%.
Regulate the frequency of your emails
Your email campaigns should be sent consistently.
Companies that sent 16 to 30 email campaigns per month have 2 times greater CTR than those who sent less or more.
Additionally, try sending emails on Monday or Tuesday when the click-through rate is the highest. More people are likely to click through emails from 6 am to 6 pm.
Place your CTA’S strategically
A recent case study from Super Office suggests that receivers will more likely click through the email with one call to action than three.
Of course, you should include a CTA button in your email campaigns, but make sure to follow the saying "less is more" when doing so.
Instead of placing multiple CTAs, concentrate on placing every CTA where it matters.
Including a CTA button in the left region can increase your email click-through rate.
3. Conversion rate
Perhaps the most important metric on this list.
A conversion is the one action you would like the email recipient to take. That can be a reply, purchase, group join or add items to cart for browser adornment emails.
Email is one of the best channels for driving conversions because with automation, you can send targeted messages to your audience on autopilot at no additional advertising cost.
In fact, eCommerce businesses utilize email marketing to drive up to 20-30% of their total purchase conversions.
The difference between conversion rate and CTR is revenue. CTR measures the number of people that click through to the destination while conversion rate measures those that took the desired/conversion action on the destination page.
To measure your conversion rate, you should divide the unique conversions generated by successfully delivered emails, and multiply the number by 100.
You can improve your conversion rate by:
Offer
An offer is an incentive given to the recipient so that they can take a desired action.
In eCommerce offers are usually discounts on products visitors have viewed, added to cart or initiated checkout for but didn’t complete their purchase.
Offers like these give customers a reason to buy but they still have to be compelling enough to drive a purchase.
Depending on how much you can discount your products, test out different offers to determine what works best for different audiences.
Content:
Send content that matches their stage in the funnel.
Every subscriber is at a different stage of their customer journey, some have just joined, others are considering purchasing your product while others have already made a purchase.
You have to provide content that matches a customer’s stage in the funnel because at the different stages, every user has a different need.
For example, new users are sent a welcome sequence to nurture them, help them learn more about the brand and build trust before they can purchase.
While those that abandon carts are sent cart abandonment emails with discount offers and social proof to help them complete their purchase.
Before sending out emails, make sure the content provided matches the recipients stage in the funnel to increase chances of conversions.
4. Bounce rate
The bounce rate shows the percentage of your emails that have not been delivered to the subscribers and has therefore been sent back to your email.
There are 2 types of bounces:
Hard bounces – are permanently rejected emails because of the incorrect email address or block.
Soft bounces – are temporarily rejected emails because the email size is too big, the recipient's mailbox is full or his server is not working.
To calculate your bounce rate, divide the total number of hard bounces by the complete number of sent emails.
The bounce rate is a clear indicator of your email list where an average soft bounce rate is less than 2%, while a hard bounce rate should be less than 1%.
A high bounce rate can give you a bad rate on Gmail and Yahoo, and even get your IP blacklisted that’s why it's important to reduce it.
Here’s how:
Clean your email list regular
Remove the email address that generated a hard bounce immediately. When a soft bounce occurs, you can try to resend the email a couple of times, and remove it if it keeps coming back.
Get proper permission before sending emails
Sending confirmation about the subscription or a welcome email will increase your chance to retain only the customers who are interested in your product or service.
5. Unsubscribe rate
The number of unsubscribed customers is critical but crucial feedback to understand if your messaging is keeping your subscribers engaged.
The unsubscribe rate defines the percentage of subscribers that are no longer interested in receiving your emails.
The average unsubscribe rate is 0.17%.
You can track the unsubscribe rate in the statistics provided by your Email Service Provider. Usually, it is measured for the last 30 days.
To improve your unsubscribe rate, you can:
Be upfront about time and frequency
Informing your subscribers about how frequently and on which days will you send the newsletter builds trust and expectation.
Send a follow-up email
Send a follow-up email to the people that unsubscribed, and present an option to re-subscribe or redirect the user to another channel.
It is even better if you use the follow-up email to ask for user feedback.
People unsubscribe for a number of reasons and their feedback could help learn more about how to improve the experience of other subscribers and may-be decrease your unsubscribe rate.
Conclusion
Growing your email list is simple, but engaging your subscribers, keeping them interested and open to your email campaigns is a much harder – but also more rewarding task.
When analyzing the metrics, ask yourself how they can lead you to increase the value of your email campaigns.