Email marketing has been touted as an effective method to gain conversions, repeat sales and customer referrals. According to the ForeSee Results Report on Social Media Marketing (US Edition), 64% of consumers prefer email to social media for receipt of marketing and promotional materials. Likewise, effective email campaigns have a higher conversion rate than social media campaigns.
Measuring key performance indicators (KPIs) such as bounce, open and click-through rates are traditional methods in which an email marketing campaign is gauged for effectiveness. However, simple metrics do not always reveal whether an email marketing campaign is truly successful, especially over the long-term. For example, studying only campaign metrics will not explain why a majority of subscribers open an email but then do not click on any of the product ads. To elucidate the true patterns of subscriber behavior, it is necessary to look beyond the numbers and assess user psychology. To this end, one can study the following seven unexpected indicators of a successful email marketing campaign:
1. Subscriber retention per broadcast
Subscriber retention is a measure of loyalty to the website, business, etc. Do a significant number of your subscribers opt-out of the email list after a broadcast? If yes, this indicates that there is an underlying issue with the emails, website, service, or something else altogether. Try testing both text and HTML-generated emails by forwarding them to your own account. Use different browsers to open and view the emails, as well as to click-through to your website. In many cases, web browser incompatibility with email formats leads subscribers to opt-out of the list.
If the issue doesn’t lie in emailing technology, conduct subscriber surveys to gauge how your recipients perceive your email messages as well as your website and its products. Perhaps they find your emails informative but your products overpriced. Alternately, you may not be providing enough value in your emails to justify opening and reading them. Obtaining subscriber advice and feedback can be imperative to your future sales campaigns.
2. Conversions resulting from email
Is your email campaign really leading to sales conversions? If you are counting on your emails to drive sales, find out just how many of them resulted in that effect. This can be accomplished by understanding what happens after subscribers click on your email’s call-to-action link and go to its landing page. Whitepaper downloads, webinar registrations, and online purchases all help resolve the question of whether subscribers are active on and involved with your website.
Using different optimization strategies can help increase sales even further. Conduct post-click surveys to determine what potential customers are thinking as they move through your sales funnel. Using multivariate or A/B testing to find out if different landing page designs, promotional offers, and product densities have an effect on consumer behavior.
3. Revenue per subscriber
Knowing how much revenue is being generated by each of your email list subscribers is vital to determining the value of your sales conversion process and how much you should be spending on your sales campaigns and ads. For example, there is no point in spending $25/prospect if each prospect generates only $10 in revenue. Subscriber revenue can be estimated by first finding out how many subscribers you have. Then, looking over your earnings for the past year, add up the number of direct (generated directly from e-mail click-throughs) and promotional sales (generated from an e-mail promotion or offer code) that you have had. Calculate revenue per subscriber by dividing revenue (R) from direct and promotional sales by the number of subscribers (S).
4. Repeat customers
Retail Active found that repeat customers spend an average of 33% more than first-time customers. Repeat customers also provide a 107% higher referral rate than non-customers. Thus, if repeat customers make up a majority of your site’s current subscribers, you are likely to see higher conversions and sales.
You can grow your repeat customer base by using certain email marketing techniques. Start a customer loyalty program on your website that awards points for every dollar spent. Then, notify your customers via email about their total points earned and how close they are to receiving a free item. Likewise, you can solicit the subscribers in your email list with product sales, store contests, etc. Finally, keep track of what your customers are buying and offer future discounts on those products.
5. Comment number and quality
When you send out an email that links to your blog post, do your subscribers immediately leave a series of comments on your site or does that web page languish in obscurity? Active subscribers are more likely to take part in your content creation efforts and provide feedback than inactive subscribers. This gets other content viewers involved and helps initiate useful exchanges of information.
If your emails are failing to engage your subscribers, try making a bold or controversial statement. Alternately, challenge your readers to do something outside of their comfort zone. Personal stories and experiences, tutorials and multi-part emails are also good techniques for “activating” your subscribers.
6. Subscriber posts
One measure of email marketing success is when your subscribers write you about posting their own (non-advertising) content on your blog or website. The posting of subscriber content indicates that subscribers are comfortable with your website, have probably read and reread its pages, and know it quite thoroughly.
How can you encourage your subscribers to start posting content to your site? Providing an incentive to post is always a good start; you might offer a copy of your e-book, a product discount, or free publicity to those subscribers who wish to add to your content. If such incentives don’t work, you may need to dig deeper and pay for subscriber-produced content. The good news with paid-for content is that you can be picky about its quality and require certain edits from the author.
7. Customer lifetime value
There are many ways to measure the success of an email campaign: clicks, visits, bounce rates and conversions. Likewise, you can measure your success by calculating your campaign’s CTR (click-through rate), conversion rate, or its CPA (cost per aquisition). However, there is another parameter that may be a more useful measurement of success: the Customer life time value (LTV). According to Avinash Kaushik (3), assessing customer LTV is preferable to simply generating sales metrics because customer LTV often leads to sales profits over the course of several years, while click-through sales last only until checkout. LTV customers bring real value to a business via product up and cross-sells, periodic purchases, higher purchase amounts, and referrals. By calculating the customer LTV of your email campaign, you are better able to learn of its long-term value.