The other day I was skimming one of the many marketing newsletters I subscribe to when the headline of a case study caught my eye — “62% Response Rate on Company ABC's Email Campaigns!!”
I fought down a pang of envy and went on to read the article with great interest — I mean, if they could do it, surely we could too. Who wouldn't want a 62% response rate?
About half-way through the article it became clear that my understanding of response rates and theirs were worlds apart. Counting unsubscribes and bounces as part of response rate measurements would never have occurred to me. It did however start me asking some questions about how people do measure Email Campaign success.
I learned two things:
There is no generally accepted definition of Email Campaign success or response rate.
Everyone wants to track Email Campaign success but few people are getting even close to what they want.
DEFINING SUCCESS
Defining success before you run your Email Campaign is absolutely critical. After all, it's hard to know if you've arrived at your destination if you don't know where you're going.
How might we define Email Campaign success? If you are doing a newsletter, your goal might be to have as many people as possible click through to your Website — in other words, success would be a high click-through or response rate. You might then define your success as:
Delivering great results to your advertisers in the form of click-throughs to their site;
Generating a bigger audience for your newsletter;
Selling something with an offer in your newsletter;
Measuring what kinds of content are most interesting to your readers;
Any or all of the above.
Deciding what success means before you drop your campaign will make it much easier to measure. It also means that your measure of success or response rate may be different than someone else's.
Some measures of success are easier to arrive at than others. The good news is that, unlike even a few years ago, technology is now readily available to let you track your campaign success.
That the tracking system be inexpensive and easy to use is so important- one of the biggest problems with doing Email Campaigns is that you find out that it will take hundreds of thousands of dollars of investment and far too much time to track what you want to track. The biggest mistake you can make is waiting to track everything and then not tracking anything. So, the first rule then, is to start with a simple plan and over time grow into complexity.
THE BASICS
I think you'll agree that the Holy Grail of email marketing is to be able show a direct correlation between your Email Campaigns and your customers' purchases (whether it's advertisers purchasing space, or prospects buying your goods or services).
If we are start with the basics, then we want to identify the key members of our audience and their rates of response. Answering the following six questions will help you go a long way towards defining what Email Campaign success means to you.
THE RECIPIENTS: HOW MANY PEOPLE ACTUALLY GOT YOUR EMAIL?
At the very least you'll want to measure how many of the emails you sent actually reached a destination inbox. That means subtracting all the bounced email addresses to know how many were actually delivered. Let's call this group the Recipients.
THE READER RATE: HOW MANY READ IT?
Getting your email and opening your email are two different things. If you knew for example that only 40% of the people who received your emails were opening them, it might suggest that your subject line needs work — after all, it's the subject line that makes people want to open the email message.
Knowing that someone opened an email is not exactly the same as knowing they read it, but it's pretty darn close. Let's call this group the Readers. The Reader Rate is the number of Respondents divided by the number of Recipients.
THE RESPONDENT RATE: HOW MANY READERS ACTUALLY TOOK SOME ACTION? (CLICKED-THROUGH, RESPONDED).
Just knowing that some people got your message and took the time to open it is a good thing to track.
Most of us like to know if any of our content was interesting enough to motivate our readers to spend more time with us. Ideally we'd like to expose them to other messages that might cause them to keep spending time with us. The more people who take action the better. Let's call this group the Respondents. Bear in mind that we should try to keep the content of our emails concise, with summaries that pull people back to more information on a Website.
The Respondent Rate is the number of Respondents divided by the number of Readers. If you can't track the Readers, the Respondent Rate can be the number of Readers divided by the number of Recipients.
THE ACTIVITY RATE: HOW MUCH ACTION WAS TAKEN AS A RESULT OF YOUR EMAIL?
Emails often include more than one call to action — usually associated with a link to more info. The total number of click-throughs from the campaign is an indication of campaign activity. More action is typically more favorable than less action, as it implies a continued investment of time by the reader and a longer exposure to your message.
The really interesting marketing challenge is balancing the number of click-throughs in a campaign against the Activity Rate. Activity Rate is the total number of click-throughs per number of Readers or Recipients.
Another measure of Activity Rate is the number of click-throughs per person. A campaign in which an average Recipient clicks on more than one link is better than a campaign with (on average) less than one click-through per person. At some point though, adding too many click-through options will actually cause your Activity Rate to decrease.
POSITIONING: HOW DO THE DIFFERENT CALLS-TO-ACTION STACK UP?
If you can track the Activity Rate (how many people clicked-through) on each call to action, you can tell whether a call to action near the beginning of the email generates more activity than one near the end.
You also find out which messages or special offers are most interesting to your recipients- for example we use these measures to find out whether our readers prefer basic or advanced eMarketing articles. Most significantly, you can also report back to your advertisers or sponsors on how many people clicked-through as a result of their message.
OPTING OUT : HOW MANY RECIPIENTS TELL US TO TAKE A HIKE?
Knowing how many people no longer want to receive your emails is important. But knowing who chooses to opt out is crucial. If you don't track the opt-outs, you risk committing the unpardonable offense of emailing them again by mistake. You must track those recipients who opt out and ensure that they are sent no further emails.
By the way, having a small ratio of opt-outs is not bad in and of itself - there will always be people who were mistaken about what your communication was going to contain. These people are probably not in your target market anyway, and therefore will not impact your ultimate marketing goals. It's only when the opt-out rate starts to grow over time that you should be concerned that your content is losing its value.
MORE COMPLEX MEASURES?
So far we've been looking at the basic issues surrounding tracking direct Email Campaigns. Naturally, there are more complex issues you will need to be consider, such as :
How many people forward (pass on) your email to how many other people?
How does your Response Rate from the forwarded people compare to the original Recipients?
How do we create profiles of people who take more than one action versus people who take no action over, say, the last 3 campaigns?
But one thing at a time. If you are not already tracking these more complex issues, don't despair! Despite all the hype about tracking, we believe that most people don't track anything near the 6 basic items above. If you are tracking these six basic measures, congratulations! You've already tasted how valuable this information can be and you'll want to do more.
