In a previous post Email Metrics 101: Establish Your Baselines, we discussed some of the key metrics you want to track. Whether you're new to email marketing or a seasoned pro, it's critical to create baselines around your marketing program. Baselines are a specific value or values that can serve as a comparison or control. This is what you are going to be measuring against to answer questions like "how do this month’s email metrics compare to my overall metrics" or "how are my birthday triggered emails performing in comparison to all my other emails."
If you haven’t calculated your baselines yet, then I recommend starting with the past 30 days worth of data to use for the basis of comparison. Aggregate those metrics and then calculate the overall rates.
For those of you that have had some time to establish a baseline and you have been gathering additional data from the campaigns, what are you doing or going to do with all that data?
You first want to determine where to start by figuring out what to analyze:
- Subject Line
- Holiday Season Performance
- Important results
- What really matters to overall email marketing performance
Start Asking Questions
If you are not sure where to start, your company/boss/peers will most likely always want to know:
- What was learned?
- How much revenue was earned?
- How much money was spent?
- What is the ROI?
To answer these questions you need to start by analyzing some of the data. Here is a useful formula to find percentage increases and decreases to measure performance.
If you are looking to find out how this year’s numbers compare to last year’s numbers just plug them into the formula. For instance, if 2010 ended with $21K in total revenue and 2011 ended with $55K in total revenue, then 2011 had a lift of 161.9% in revenue year over year.
This formula can be really eye-opening when comparing things like:
- Tests: when you try something new you can see how much better (or worse) the test performed over the baseline
- Month-to-month results: how is revenue trending over time?
- Different campaign types: For example, if your welcome email conversion rate is 10.4% and your average conversion rate for broadcast marketing messages is 3.2%, then your welcome message conversion rate is 225% higher.
Another great formula that I use all the time and will help you is RPE (Revenue Per Email):
Revenue Per Email (RPE) is a great and underutilized metric. In a post in ClickZ, Jeanne Jennings, hits the nail on the head with the importance and value of doing the RPE calculation.
RPE will tell you how much revenue is generated for every email you deliver. If you are not looking at RPE, start calculating it right now.
Calculate RPE for your individual emails, campaigns, segments, lists, tests, and keep watch of this metric over time. This will help you start analyzing the value in the emails you are sending.
I’ve been asked, “How can I calculate RPE if I am not tracking revenue?” If you are not tracking the traditional conversion that leads directly to revenue, then you are tracking some other kind of conversion: whether someone has downloaded a white paper, or submitted information. Try to use these numbers and apply them to the RPE to come up with some kind of “converting” metric.
Use the calculated performance and RPE data to start figuring out what is working, what is influencing success (or not) and try to inform the planning process. These observations are going to help you market in a more effective way moving forward.
If you've seen surprising results, let us know below in the comments section.