In today’s world of seemingly endless analytics streams, it’s hard to know exactly what email marketing metrics you should measure. Unfortunately it is also increasingly difficult to know how much weight you should put on each set of metrics. Measuring performance is a fundamental part of running a business and email marketing is no exception. So what email marketing metrics should we measure?
Key metrics for SMEs
Unsurprisingly, SME owners / marketers usually have the most interest in business case metrics. (Source: SalesForce State of Marketing 2015) Investment returns are almost, and rightly so, the single most metric they cite in terms of marketing measurement. Common sense tells you that spending money on marketing without knowing whether you generate revenue or sales would be a bad decision.
Key marketing professional metrics
Marketing professionals who specialize in email marketing tend to give more weight to the more technical metrics of non-business cases. Metrics like open rate, click-through rate, bounce rate (hard and soft bounce), distribution speed, are all very important for an email marketing professional.
Hubspot discussed key email marketing performance metrics in their February 2016 Email Analytics blog: The 6 Email Marketing Metrics and KPIs you should be tracking. They list them as follows:
- Click through rate
- Conversion rate
- Bounce rate
- List growth rate
- Speed of sharing / sending email
- Return on Investment (ROI)
The list above reflects the previous point about the priorities that email marketers place on non-business case metrics. While ROI is mentioned, it is ranked sixth behind smaller business case metrics.
ROI versus non-business case metrics
Email marketing software has made it incredibly easy to measure email marketing metrics with data such as open rate, click through rate, and bounce rate metrics at marketers’ fingertips. However, it is more difficult to calculate the return on investment, especially when it is not easy to track sales and lead data.
Unfortunately, the above leads to a clear conflict of priorities between the business owner / seller and the email marketing professional providing a service. So who’s right? The small business owner will quickly point out that there is little point in having an open or high click rate if it does not translate into investment returns. It’s a rare topic that you can argue against because no one wants to lose money.
In SalesForce’s 2016 State of Marketing report, a survey of thousands of businesses and marketers found that 79% reported that email marketing directly generates return on investment, up from just 54% in 2015. Marketers appear to be recognize that ROI is a key measure of email marketing performance, aligning with what many SME owners have always known.
Take a holistic view
There is no doubt that ROI is the most important performance measure when it comes to email marketing or any other marketing strategy. That said, other non-technical business case metrics play a vital role in measuring the success of an email marketing campaign.
The email / forward sharing rate is a great example of a non-business case metric that provided insight into your marketing campaign. A high / forward share rate may not directly lead to an immediate improvement in ROI, but it does show the marketing team that the campaign content is extremely interesting and high quality.
Exit rates give the marketer an idea of how many subscribers are abandoning their list. It’s a hugely important metric that doesn’t yet have a direct impact on the company’s return on investment, but is vital to the continued success of their email marketing. Losing subscribers means a smaller audience, which will ultimately lead to lower ROI.
Taking a holistic view to measure marketing metrics is the key to email marketing success. While returns on investment cannot be said to remain the dominant metric, other performance metrics play a key role in ensuring the long-term success of email marketing.
Quantifying the return on investment
Measuring and quantifying the return on investment is often very difficult. Online stores are not as difficult as easy tracking using advanced Google Analytics, but tracking sales, leads, and ROI in-store and through other channels is often much more difficult. Unless a customer specifically tells business staff that their interest has been generated by email, how can the email marketing team measure the return on investment?
SME owners must ensure that appropriate measures are in place to measure the source of revenue and sales opportunities to provide email marketers with the data they need to measure the return on investment. A marketer can hardly be blamed for not measuring ROI if the company itself does not provide the basic data needed to measure accurately.
ROI is always number one
Marketers and business owners / managers need to ensure adequate attention is given to a variety of email marketing performance metrics. The question of which metrics are most important will vary from industry to industry, but you can be assured that business owners will always demand investment returns as the dominant key metric.