If you’re investing in ecommerce email marketing, how do you know when you’re doing a good job? How do you know what you could do better?
Knowing what metrics to track, what they mean, and how you can impact them is key to email marketing success. Let’s say you have a list of 11,000 subscribers. You send out emails twice weekly and see some pretty decent sales numbers. What happens if 1000 of those subscribers stop opening or responding to emails?
Naturally, ecommerce stores see people drop off their lists periodically, which is one reason to keep an eye on your metrics. Sometimes there may be strategies you can follow to gain better engagement and avoid too many people unsubscribing.
What metrics really matter to ecommerce email marketing? We’re breaking them down here:
Top Ecommerce Email Marketing Metrics
Before diving into our top picks for metrics to track, a note about open rates. Open rate has typically been an important metric in email marketing (possibly the most important), telling you what percentage of people who received your email actually opened it. However, things are changing with the open rate metric.
Specifically, open rate is no longer a reliable engagement metric due to Apple’s release of iOS 15, iPadOS 15, macOS Monterey, and watchOS 8. Apple has added features to prevent user data from being collected by third-party apps, including Mail Privacy Protection (MPP), which prevents senders of emails from collecting information such as whether a user opened an email. Instead, Apple preloads email content, meaning it will always show as “opened.”
MPP prevents you from getting accurate data on open rates, where your users are when they open your email, the activity on the device used to open the email, and what device the audience used to open the email. Given that over 55% of US smartphone users have an iPhone, that leaves you with a high risk of inaccurate data if you rely on open rates to track engagement. You need other metrics that will be more reliable.
These are the top ecommerce email marketing metrics businesses should track:
Click-through Rate
The click-through rate tells you how many of the people who opened your email clicked through on a link to your website (or wherever you’re sending them). It’s an important metric because it tells you whether people are interested enough in the content of your email to click on a link and look further.
According to Hubspot, the average click-through rate for retail is 8.53%. Looking at benchmarks for your particular industry to understand where you sit is essential. Is your click-through rate greater or smaller than average?
If you’d like to boost your click-through rate, remember that it conveys how well your emails grab subscribers’ attention and inspire them to take action. Some tips for improving click-through rate include:
- Use sales psychology to prompt action in people. For example, many people are motivated by the principle of scarcity, which states that we want more of something of limited availability. Sales techniques such as advertising your limited stock can have people clicking through to claim theirs before they’re all gone.
- Offer a limited sale or discount. People will often click through to browse if they know they have a coupon code available.
- Test your CTAs (calls to action). Examine your data to find which calls to action prompt more of a response.
- Test the links in your emails. Make sure they’re easy for subscribers to click through on different types of devices.
Deliverability
Deliverability is the rate at which your emails make it into subscriber inboxes. It is the percentage of emails delivered to the inbox out of the total sent. Why wouldn’t your email reach the inbox? A few things can either send it to spam or cause it to bounce, such as:
- Invalid email addresses. You should expect some of this when someone has canceled their email account, but more often, it happens when a business buys an email list full of invalid email addresses. (Never buy an email list!).
- Too many of your emails get reported as spam. If this happens, email providers such as Gmail will tend to flag your emails as spam, and subscribers never see them.
- You have a bunch of disengaged subscribers still on your list. When people don’t open your emails for a while, their email provider tends to assume they are spam and direct them to the spam folder. This filtering is a good reason to regularly cleanse your list of disengaged subscribers (after you’ve tried to re-engage them).
- Your content or subject line includes spam triggers. These include things like using all caps, using a lot of exclamation points, or using trigger words such as “free” or “guarantee” (basically anything a shady salesperson might use).
How do you improve deliverability? Avoid the factors above and focus on maintaining good list health. Your list should be current and regularly cleared of invalid addresses or disengaged subscribers. You should also ensure you include a clear unsubscribe link so people can easily do that themselves.
Conversion Rate
Conversion rate is the measure of how many subscribers take your desired action – typically, buying something in the ecommerce world. It’s the percentage of people out of the total number of emails you sent out who took that action.
Different ecommerce categories have varying average conversion rates. Health and well-being are the highest at around 3.72%, followed by arts and crafts at 2.85%. In any category, you can see that you want an extensive list of subscribers if you want to impact your revenue through email marketing. (We suggest you aim for 10,000 plus subscribers).
How do you improve conversion rates from email marketing? Besides having an enticing offer that invites people to click through in the first place, you need to focus on the experience customers have once they’ve clicked through. For example:
- Fast load speeds.
- Easy navigation from any device.
- Attractive (and functional) website design.
- An optimized checkout process.
It’s also worth keeping an eye on your conversion rate by email type. For example, your automated emails versus your campaigns or different types of automated emails versus others. Know what works well for you!
Email ROI
What return on investment are you getting from email? Famously, email has one of the best average ROI of any marketing channel, with an average return of $36 for every $1 spent.
Calculate ROI with the following formula: (Revenue – Spent)/Spent = Return on Investment %
You can calculate your ROI either per campaign or as a whole from email marketing over a set period. Revenue is the sum of all your sales, while expenses may include an email marketing service, email platform fees, and paying designers or copywriters.
To improve ROI, you either need to drive up revenue, drive down expenses, or both. Most ecommerce stores aim for a balance where their expenses remain affordable and their revenue has sustained growth. Sometimes you need to spend more to grow more (e.g., you might need to hire expert email marketers to get better results), but ROI is also a function of your conversion rate, so taking steps to improve that can help.
List Growth Rate
Your list growth rate is the rate by which your list of subscribers grows over a certain period (most businesses measure monthly). List growth is a key to successful ecommerce email marketing – you need to take consistent steps to grow your list.
Why is growth so significant? Because naturally, people drop off your list over time. If you sit on your list of 10,000 subscribers thinking you’ve got more than enough, you’ll find that list starts to shrink, and with it, your key engagement metrics.
What can you do to grow your list? Here are some ideas:
- Always have a subscribe option available on your website. For example, use pop-ups that make an offer for first-time subscribers.
- Run campaigns to get more subscribers. For example, you might offer people membership or an account on your site. Entice them to sign up by ensuring that being a member delivers them some sought-after value.
- Take steps to keep your current subscribers. Deliver them what they expected when signing up and keep your emails relevant to the subscriber. Use techniques such as list segmentation to improve relevance.
Additionally, monitor your unsubscribe rates, too. You can expect some will unsubscribe, but ideally, you want this figure to be as low as possible. A high rate of unsubscribes should trigger you to inspect why that is happening.
Conclusion
The five metrics outlined here are some of the most important indicators of the health of an ecommerce email marketing program. If you keep track of these and take steps to improve them, your own email marketing should see some great results.
Does your ecommerce business need help with handling your email marketing? SmartMail is here for everything from list growth to email automations and copywriting campaigns. Click here for your free email growth plan.
