Best Practices When Measuring Email Performance
What makes a successful email campaign? How do you filter through the right metrics? Which practices help drive engagement and revenue? Let’s deep dive into the importance of Customer Relationship Management (CRM): how to set the right goals for your campaign, identifying KPIs, and effectively segmenting contacts to run a successful email campaign.
Why do we need email marketing?
Compared to other digital marketing strategies, email marketing has one of the highest ROIs. Developing best practices can be a time-consuming process, but optimising email performance can drive up customer engagement and their lifetime value.
What’s the importance of CRM in email marketing?
Customer Relationship Management uses technology to manage interactions between your brand and your clients, both potential and existing. The goal of CRM is simple: to build personal relationships with your clients.
Today, clients are looking for more personalised experiences from companies in exchange for their loyalty. That’s why it’s more important than ever to understand what your clients do and don’t like about your organisation’s communication — and use that understanding to improve your email marketing performance over time.
How can we measure the performance of email marketing?
Before performance can be measured, there are a few steps we need to take to ensure everything is tracked and analysed appropriately. This includes setting up the right tagging, tracking and integration with an attribution model.
What does appropriate performance measurement look like?
A well-planned performance measurement system in email marketing will include things like:
- Ensuring performance metrics are measurable from all touchpoints in the customer journey — from the moment we send an email, all the way to conversion
- UTM tracking, which when implemented across all touchpoints can track the source of link direction, the medium, and the content that sent a customer down the funnel
- Tracking activity from leads who fill out landing page forms, and integrating their details into the CRM database.
Parameters to consider when measuring performance
It’s crucial to understand parameters before we implement performance metrics. Parameters help us narrow down our objectives in order to implement improvements to optimise our campaigns.
Parameters for email marketing might include:
Timeline and duration
Timeline is an important parameter, because different campaign types require metrics of different durations.
For example, monthly newsletters will have very different results from quarterly newsletters, so we need to measure them accordingly.
Practice good email cadence techniques as a great way to boost engagement over time — and with A/B testing, we can work towards building a solid understanding of the perfect time and frequency to send emails.
There are several questions to consider when choosing the right duration for performance measurement:
- How much are we relying on previous results to measure performance?
- How long is the duration of our current campaign?
- Do we want to measure using monthly, quarterly or yearly metrics?
It’s crucial that we understand what we want to achieve when sending an email. Goals for every organisation (and every campaign) vary, but generally the goal for every email is for the recipient to open, click and drive action.
But we can get more specific…
- Is our goal to grow our subscriber list? Then we should be paying attention to new form fills and unsubscribers.
- Are we trying to inform or educate our audience, or drive a certain action? If so, we need to look closely at click rates.
- Do we want to increase email open rates? This might require a more engaging subject line in future campaigns.
Essentially, metrics to measure engagement should be based on the end goal of the campaign. We can think about the 5 Ws when putting together the goals of a high-performing email:
- WHY am I sending this? Is there a desired action I want the recipient to take?
- WHO am I sending this to?
- WHAT should the recipient do?
- WHEN should this email be sent?
- WHERE will this email be viewed? On mobile, or on desktop?
What are the right email marketing KPIs for my business?
Email KPIs are metrics that help you understand campaign performance and strategise to optimise future campaigns. When you send emails using a marketing platform, it tracks email receive rates, open rates, click rates, and more. This data is aggregated into reports to show how performance changes over time, which you can then compare to industry benchmarks.
KPIs can include:
Click-to-open rate (CTOR)
What is it?
Click-to-open rate measures the number of unique links opened from unique email opens. It’s more reliable than open rates alone, due to recent MPP regulations which may affect the accuracy of open rates.
CTOR can be used to compare performances across various emails with differing content styles, and is a solid measurement of email content engagement.
What is the industry-average CTOR?
The industry-average CTOR is from 6 to 17%.
Click-through rate (CTR)
What is it?
The next-best thing after your open rates and CTORs are optimised, click-through rate measures the number of recipients who click on any tracked link out of those who opened the email. It’s useful for measuring performance and engagement, and low CTR is most likely due to poorly located CTAs which don’t grab enough attention.
What is the industry-average CTR?
The industry-average CTR is about 2 to 5%.
What is it?
Bounce rate is the rate of emails that are rejected by the server, and it measures email deliverability and the quality of your contact database. There are two types of bounces: hard bounces and soft bounces.
Hard bounces are most likely due to invalid emails, whereas soft bounces are usually due to a temporary disruption in deliverability (such as a full inbox).
It is best practice to remove hard bounces from your email database, because they can affect the sender’s reputation. We can also reduce bounce rate by implementing a double opt-in process.
What is it?
This is the rate at which audience members are opting out of receiving emails from your organisation, and it helps measure the overall growth rate of each list you create in your database. A high rate of unsubscribers is an indication of irrelevant content which is no longer providing value to the recipient.
While valuable, this isn’t always the most accurate metric — many recipients don’t bother unsubscribing, even if they don’t wish to receive further emails.
How can I effectively segment my email marketing audience?
Segmentation is a great way to enrich our content strategy and effectively cater each campaign to its appropriate audience. For example, prospects who regularly engage with our content should be in a different stage of the funnel (and therefore receive different content) compared to those who don’t engage as frequently.
We can use the following categories to effectively segment our CRM platforms:
These are prospects who have engaged with emails that our organisation has sent within the last 6 months — and the rate of this should be a metric in itself to maintain a healthy contact database. Targeting engaged prospects means we only engage with willing recipients and have an accurate measure of our performance.
Unengaged prospects have not engaged with emails sent within the last 6 months. Our marketing efforts to this segment should be solely directed to ‘win-back campaigns’ designed to re-engage those who used to interact with our content but have since reduced their activity.
To sum up
Ultimately, the mark of a successful email campaign is the rate of engagement to revenue generation.
Every email marketing campaign is different — especially with differing goals like generating leads or growing a subscriber base, but every email marketer needs to know how to best implement the practices and KPIs discussed in order to optimise email campaigns to drive engagement and revenue.