Measure the Success of Your Email Campaign
by James H. Byrd
Most marketers will tell you that if you can’t measure it, you can’t improve it. That philosophy is as important in your email campaigns as it is in any other form of marketing you might try.
Because many factors can influence the effectiveness of your email campaign, it helps to test different approaches. As with any marketing process, you need to establish metrics that tell you how well one approach works when compared to another. When you find something that works, make that your control, and then experiment to find something that works even better. You can always fall back on your control if the results of your experiments are disappointing.
All marketing has a common goal: conversion. You are usually trying to get a prospective customer to sign up for something or buy something. Internet marketing, and email in particular, allow a surprising number of measurement points that let you see how well your customers are responding to your message as they travel the purchasing-decision path.
Here’s a quick look at email marketing metrics.
Deliverability. Your first goal is to get your message to customers. You must get through their spam filters and challenge/response systems. You must avoid being blacklisted. Your email server must be properly identified as a valid sender for your company. All these challenges relate to your campaign’s deliverability, which is how many of your messages reach their intended recipient.
Open rate. Your message must interest your customers enough to get them to open the email and look at it. The percentage of customers who actually see the message is your open rate.
Click-through rate (CTR). Even if customers open your message, you need them to take the next step and click through to your Web site, or pick up the phone and give you a call. Your click-through rate measures how well they respond to your offer.
Conversion rate. If everything goes according to plan, your customers buy something from you. Your conversion rate measures how many people reached a purchase decision based on the message you sent them.
Deliverability is difficult to measure. Your first indication of a problem is when messages are bounced back to you. However, mail servers don’t always bounce messages: sometimes the server accepts them and then deletes or quarantines them later.
It may be necessary to set up a test account or two in each of the major email services, such as AOL, Hotmail, and Gmail. If your test accounts don’t receive your message when you send out an email campaign, you can bet many of your customers aren’t receiving it either.
You can avoid rejection problems to some degree by carefully crafting your content. Many email campaign tools give you a spam index, which is a relative measure of how the content filters on email servers will see your message. Adjust your content to lower the index so your message won’t look like spam to the filters.
Blacklists are another filtering mechanism many ISPs use. Several email watchdog organizations keep track of IP addresses and domain names that are known sources of spam. If you regularly send bulk email, you are almost guaranteed to get on one or more of these lists at some point.
Even if your messages make it over the blacklist and spam filter hurdles, your customers may have tools that set up another line of defense, such as spam filters or challenge/response systems.
When you send out an email, monitor your test accounts and watch for bounces. You also may need to rewrite your content to keep your email from ending up in spam filters.
Measuring Open Rate
Assuming your email makes it to your customers’ in-boxes, it doesn’t mean the customers will actually open and read the message. Your open rate is the number of people who open your message divided by the total number of messages sent, expressed as a percentage. For example, if you send 3,000 emails and 350 people view it, your open rate is about 12 percent.
If you create HTML email, you can include images in your messages. Those images can be pulled from your Web site, which means your Web-server logs will have a record of every time an image is retrieved. In essence, that is how most email campaign tools track your open rate. They often add a special tracking pixel to your message that triggers a counter of some kind when your customers open the message. Some of these counters are quite sophisticated and go well beyond a simple Web-log entry.
Note that if you send plain-text email only, you don’t have a way to trigger a tracking mechanism, so you won’t have a way to track your open rate.
Open rate should be used to compare campaigns, and not as a definitive measure for a particular campaign. Several factors can interfere with it. For example, some of your customers may have a preview window turned on that will trigger your counter, even if the customer did not intentionally open or read the message. Also, some email programs turn off images until a user explicitly enables them. In that case, a customer who is interested enough to open the message may not trigger your tracking mechanism.
Open rate is most often used for subject-line testing. To improve your open rate, the next time you send an email campaign, try splitting your audience into two or more subsets, using a different subject line for each. Your open rate will tell you which subject line appealed most to your customers.
Measuring Click-through Rate
Since email campaigns are generally designed to get customers to sign up for something or buy something, the content of the message should be compelling and clearly explain the benefits of taking the next step. That next step is your call to action. The action might be a phone call, but more often you want customers to click through to your Web site.
You can measure click-through rate in a couple of ways. One way is to append a special code of some kind onto the end of your URL. When customers click the link, that code is logged in your Web site’s log files. You can then use a log-analysis tool to count how many requests included each code.
Another way to measure click-through rate is to use the facility that is built into many email campaign tools. When you enable click-through tracking in these tools, they replace your URLs with URLs that include a unique link identifier. Then, when customers click a link in your message, the replacement URL funnels the request through a Web server that counts the link identifier before forwarding customers on to the original URL that you provided. You can later review the click-through rate of your campaign using reports provided by the campaign tool.
While open rate measures the effectiveness of your subject line, your click-through rate measures the effectiveness of the marketing copy in your message. If you have a good open rate but a poor click-through rate, you probably need to do a better job of explaining the benefits of your offering. Relevance is the key to a good click-through rate. If your offer is relevant to the audience that receives your message, you will enjoy a higher click-through rate than if you send the same message to a more general audience.
Measuring Conversion Rate
The final point of measurement in most email campaigns comes at the moment your customer clicks a button that accepts your offer. Conversion rate is a measure of how many email recipients placed an order with you or otherwise committed themselves to whatever it is you are offering. They’ve opened the message, clicked on a link, and now finally clicked the Buy button or taken some other desired action.
Measuring the conversion rate of a specific campaign can be challenging. The simplest approach is to know the average conversion rate of your site and measure the bump you get after you send out an email campaign, but this isn’t terribly accurate.
When you really want to know the conversion rate of a specific campaign, you have to use more sophisticated techniques. The key here is some kind of offer code on the link that takes customers to your Web site. The offer code should uniquely identify the email campaign, and your shopping cart software must somehow stamp the order with that offer code.
If your shopping cart software does not offer tracking tools, you can sometimes get your customers to help with tracking by, for example, including a coupon code with each offer, just as you may have done or still do with offline direct mail. Providing a different coupon code for each email campaign will obviously help you track an order back to the campaign that inspired it.
When your Web site enters the mix, it affects the marketing metrics. As soon as visitors click through from a message to the Web site, you are measuring the effectiveness of your Web site to close the deal. If you have a high click-through rate but a low conversion rate, the problem is probably in your Web site, not your email campaign.
Optimizing an Email Campaign
Once you understand the metrics, you can use them to optimize and troubleshoot your email campaigns. After every campaign, sit down and analyze what happened. Step through the metrics one at a time and compare them to metrics from your other campaigns.
Here is a quick overview of how you measure them, and how you optimize them.
Deliverability. Use test accounts and watch for bounces. Tweak the subject line and content to minimize your spam index. Send only to customers who have explicitly requested your messages.
Open rate. Use HTML messages that include a tracking pixel. Tweak the subject line to make it compelling.
Click-through rate. Use a link redirection tool that counts each click and sends the visitor on to the appropriate page. Tweak the marketing copy to improve response.
Conversion rate. Use an offer code or coupon that gets associated with each order placed as a result of the email campaign. Tweak the site copy to maximize cart adds and the checkout process to minimize cart abandonment.
Customer responses are subjective, but patterns emerge if you watch for them. By carefully measuring customer responses to each change you make in your marketing message, you can get valuable information about what drives your customers to make purchasing decisions. For a marketer, there’s no better information than that.
James H. Byrd is the vice president of Logical Expressions, Inc., a book and software publisher based in Sandpoint, ID, and co-author of Web Business Success: The Entrepreneur’s Guide to Web Sites That Work, one of several titles created using the company’s IdeaWeaver writing and creativity software. He can be reached via www.LogicalExpressions.com.
We use AWeber (AWeber.com) for our email marketing. AWeber provides many of the measurement tools I mentioned in this article, such as bounce tracking, open tracking, and click tracking. It also provides subscribe and unsubscribe features that automatically maintain your list for you.
Other email services include:
Constant Contact (constantcontact.com)
Get Response (getresponse.com)
If you are committed to growing your business through email marketing, you should invest in good tools. A good email campaign tool gives you ways to measure your open rate, your click-through rate, and even your deliverability to some degree. A good shopping-cart program lets you track offer responses and can report the conversion of those responses.