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Basic Email Marketing Metrics Explained

Open rates. Click-through rates. Conversions. Each metric tells you something about your email marketing program. Open rates measure such things as trust, effective subject lines, timing and frequency while click-through rates illustrate how effective such things as content, layout, offer and link placement are at reaching your audience. Conversions, whether requesting information or purchasing a product, demonstrate the effectiveness of an email marketing program.

Open rates and click-through rates by themselves can be misleading. To get a better understanding, lets take a look at each one individually.

Email Marketing Open Rate (OR)
OR = unique opens / total number of emails delivered

The total umber of emails delivered is the difference between number of emails sent and total number of bounces. So you may have sent out 10,000 emails, but 1,000 bounced so only 9,000 were actually delivered.

Lets say that there were 3,200 unique opens. Plug that into the equation and you get a 35 percent open rate.

Open rates, however, are misleading for 4 reasons:

  1. Preview Panes
  2. Blocked Images
  3. Delivery Issues
  4. Text Versions

Many email clients have a preview pane, and image blocking is a default setting. If the images remain blocked, even though a reader may be viewing the email, it will not count as an open because no image download took place to signal an open.

In terms of delivery, messages that are undeliverable, get filtered out as junk or caught in a SPAM queue do not generate a bounce message and are considered delivered. So in our example of 9,000 delivered, that number might only be 8,000. Now the open rate is 40 percent instead of 35.

Open rates may not include text versions either as there is no image associated with them. A text version is considered "open" when a link is clicked.

Though the above equation is the accepted definition of an open, not all marketers adhere to that definition. Some measure total opens instead of unique opens, leading to inflated open rates as a reader could open the email more than once. Others measure opens against total emails sent instead of emails delivered so bounces are counted.
 

Email Marketing Click-Through Rate (CTR)
CTR = unique clicks / number of emails delivered

The total umber of emails delivered is the difference between number of emails sent and total number of bounces. So you may have sent out 10,000 emails, but 1,000 bounced so only 9,000 were actually delivered.

Lets say that there were 1,500 unique clicks. Plug that into the equation and you get a CTR of 16.6 percent.

Click-through rates do not take into account the number of emails opened, only the number of emails delivered. Just like with open rates, emails that do not generate a bounce are considered delivered. Using our original example, if 8,000 emails were delivered but there were still 1,500 unique clicks, CTR is 18.75 percent instead of 16.6

To gauge the true success of you email marketing campaign, you need to look at what is called the click-to-open rate.

Email Marketing Click-to-Open Rate (CTOR)
CTOR = unique clicks / unique opens

CTOR combines the measurements of open and click-through rates that are used to determine the effectiveness of an email marketing campaign. CTOR also provides a better perspective on the success of the parts of an email marketing campaign:

  • Offer and content
  • Design and layout
  • Timeliness and frequency
  • Link placement
  • Level of trust

Each factor plays an important part in the success of your email marketing campaign. If the offer isn't enticing, if the copy is poorly written and the design hinders a reader's ability to understand the message, then your CTOR will be low and you will not be getting the full benefit of your email marketing campaign.

Another important metric to measure, especially for an eCommerce website, is click-through to conversion rates. The simplest way to do so is to integrate your email marketing campaign with your website statistics, giving you the ability to track not only click-through to conversion rates, but also where in the process people are dropping out.

Source: Azavar

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