Lifecycle email campaigns are a fantastic way to get the right emails, to your targeted customers, at the right time. To know what is effective in your email campaigns and what isn’t, it’s crucial to know the when, who, and what are driving your results. Email marketing metrics help gauge success of campaigns, but not all metrics are created equal.
Inaccurate or lower-quality information might sabotage the overall effectiveness of your campaign or prevent you from making the right improvements.
In the post iOS-15 world, open rates are not fully reported by Apple devices, so platforms still show open rates, but they are no longer reliable. The result is that metrics previously used don’t have as much value now. This shift isn’t bad because it has eliminated much superfluous information and narrowed what marketers should focus on to the most critical benchmarks.
What metrics should you use to achieve ultimate effectiveness? Let’s go through them.
Conversion rate is the measurement of how many people convert through your campaign. If you send 1,000 emails and 20 people convert, you have a 2% conversion rate. Knowing the conversion rate is a way to judge the efficiency and effectiveness of the campaign.
The definition of conversion can be many different things depending on the organization. While most people would think of a conversion as someone purchasing at an online store, it could also be downloading an ebook, registering for an event, signing up for a regular newsletter, etc.
Your conversion rate is ultimately a measurement of calls to action (CTA). If your CTA stands out and prompts people to click and act on the site, it’s effective.
Click-Through Rate (CTR)
Even the most fantastic email campaign in the world is a waste if people get to your site and then do nothing. Dividing the total number of times someone clicks in an email by the total number of emails sent tells you your CTR. A high CTR is excellent news and means that you’re running an effective campaign and your CTA is solid. A high CTR equals high site traffic, so it is always a worthwhile goal.
This information becomes the most valuable when you compare it against your conversion rate. If many people are clicking but not converting, you have an outstanding campaign, but something may be preventing a conversion on the website.
Click to Open Rate (CTOR)
While the iOS15 update invalidates this measure for those using IOS devices, it is still very useful because people using Andriod, MacOS, and PCs will still provide you a true open rate. Think of those devices as a really big and really good data sample.
This metric simply reports how many people opened the email and then how many of those clicked on the link. If 100 people opened the email and 25 clicked on the link, you have an impressive 25% CTOR.
Just as this metric’s value changed with the iOS update, marketers should be warned to hold this data with open hands. Google is now marking more and more sales-based messages as spam, so this metric could become even more volatile as deliverability ticks down.
A pretty straightforward metric, the number of people who unsubscribe from your campaign, tells you how well your message resonates with your audience. If the rate is high, you might need to look at your campaign design, segment your lists more, and deliver more personalized messages. Segmenting your audience so that people only receive the content they’re most interested in will help maintain a reasonable unsubscribe rate. Even just having the recipient’s name on the email can increase personalization and reduce unsubscribes.
Every investment your company makes has an ROI associated with it, and it’s crucial to know the ROI of your marketing activities.
It is a simple measurement, divide your net revenue by the cost of a campaign, and you have your ROI. Email ROI is simple to calculate and tends to affirm that email lifecycle campaigns produce much value for each dollar spent.
Remember that a straightforward calculation of ROI only tells one piece of the story, so remember to consider the next couple metrics a part of your ultimate return on email investment.
Customer Acquisition Cost (CAC)
CAC is a metric of tremendous importance for every company, and this applies even more so when a company is in the start-up or expansion stages. Ideally, a customer would cost little to acquire and then stay with the company as a long-term and profitable customer.
To measure the CAC from your email campaign, take the total cost of the campaign and divide it by the number of customers acquired. Every type of campaign you run should have the CAC calculated to know what are your most efficient forms of marketing.
CAC can be measured at the campaign, segment, marketing form, or company-wide level. If one campaign has a CAC of $5 and another is $15, it’s clear which campaign works best.
Customer Long Term Value (CLTV)
You’ve acquired a customer. Great! Will they be buying ice cream, chips, and soda every week, or was it just a one-time purchase of a pack of gum? CLTV measures the total income your business can expect from customers over their lifespan. The measurement is simply the customer value times the average customer lifespan.
This metric can be calculated at the campaign, segment, marketing type, and company-wide levels like CAC.
Once there is a value calculated, this metric is used compared to your CAC. If you’re spending $20 to acquire a customer and their CLTV is $15, that’s a problem. Different campaigns will have different CACs, and the CLTV they produce can vary as well. Comparing them against each other with CAC and CLTV is crucial.
We like acquiring customers inexpensively and turning them into high-value brand loyalists. It’s a style that looks good on any business.
Email lifecycle campaigns can be a great form of marketing that expands your customer base or increases customer activity. Compared to other forms of marketing, the return on investment and customer acquisition cost can be exceptional.
Every campaign needs to be evaluated with these metrics to know what works and what doesn’t. Every brand, product, and service is unique in email marketing. Still, as you dial in your campaigns over time, you’ll be shocked by how effective they can become at attracting new customers, increasing the value of existing customers, and reinforcing your brand.