How to Measure Email Marketing Results

How to Measure Email Marketing Results
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  • 0:03 Businesses & Email Marketing
  • 0:29 Email Marketing Measures
  • 2:32 Return on Investment
  • 3:20 Testing for Success
  • 4:05 Issues to Consider
  • 5:42 Lesson Summary
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Lesson Transcript
Instructor: Lucinda Stanley

Lucinda has taught business and information technology and has a PhD in Education.

In this lesson, we'll take a look at various ways to measure the success of email marketing campaigns so businesses can see if they are getting an adequate return on their email marketing dollars. We'll also discuss some issues in getting those marketing emails read.

Businesses & Email Marketing

In a recent survey, 56% of businesses plan to make use of email to enhance their marketing campaigns. 56% - that's a lot of businesses who will be flooding your inbox with requests for you to think of them when you consider buying their product or service.

Is it worth the money? Let's take a look at some of the numbers that are crunched in an attempt to see how well the email campaign is going and if it's worth it.

Email Marketing Measures

Businesses can get all kinds of statistics from their email providers. They use a variety of metrics, or measurements, to determine the success of their campaigns. Two readily available metrics are open and unsubscribe rates.

Open rates are the simple statistic about how many people opened an email, and the unsubscribe rate is the number of people who use the option to unsubscribe from receiving the emails. Unfortunately, neither one of these is very reliable because there is no way of knowing if the recipient actually read the message or simply opened it to get it off of their unread list, and not everyone bothers to unsubscribe. Most people just automatically delete the email hoping eventually the business will get the message, which they should if they are paying attention to their email lists and updating it frequently.

Let's look at some measures that give some real data that businesses can analyze and act on, which include click-through rates, conversion rates, bounce rates, and email sharing or forwarding rates.

Click-through Rates

Click-through rates track the number of recipients who opened an email and clicked on one or more links, which are known as calls to action. This is a metric that can change from day to day because not everyone goes through their emails as soon as they get them. This number can be used to determine if the content of the message is engaging.

Conversion Rates

Conversion rates are the number of recipients who completed a call to action, such as making a purchase or filling out a form. Now, this is some good information.

Bounce Rates

Bounce rates are the number of messages that are returned as undeliverable. Businesses need to keep an eye on this and eliminate these addresses from their email lists or they run the risk of their messages being flagged as spam, which we'll discuss later.

Email Sharing or Forwarding Rate

The email sharing or forwarding rate is an indicator of new customer generation. Every time someone on a business's email list shares or forwards the business's message to someone on that person's contact list, the message reaches another person who could be a potential customer, which means more money for the business.

Return on Investment

The return on investment, or ROI, is the big one, the measurement a business should use on any marketing campaign. For email marketing, this is where the business sees if the money it's spending on an email marketing campaign is actually turning into revenue dollars. There are some more complicated ways to calculate this; however, let's look at a simple, quick example. Let's say Brown's Business noted a $6,000 increase in sales and spent $2,000 on the email marketing campaign. 6000 - 2000 x 100 / 2000 = 400000 / 2000 = a 200% return on investment. Of course, the email marketing campaign may not be the only reason for the increase in sales. How can a business know if its email campaign is successful?

Testing for Success

One way to see if a particular email marketing campaign is successful is to do split testing. Split testing is an experiment that businesses conduct to see if one email marketing strategy works better than another. They create two (or more) emails that have different approaches. For example, they could have different versions of a form, different strategies for the subject line, an emphasis on different calls to action, or different designs. Then, the same metrics are calculated for each message. The business can then determine which strategy was more successful, or it can continue to make changes and test the effectiveness of the new message against previous messages. It becomes a cycle of making changes and testing those changes.

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