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As a follow on from a post I wrote in March, eight best practice tips for writing effective email copy, I’m tackling the wonderful topic of campaign effectiveness. 

This is quite an interesting topic, and not just for email marketers.

Taking a very safe wild guess, I would estimate that most people who have access to an email address have received an email as part of a campaign.

So basically anyone who has signed up to Groupon, Asos, Econsultancy …

I could go on. But I won’t. Anyway...

As with all marketing activities, email campaigns can only really be improved by comparing results from email activity with intended goals. By using this approach it is much easier to identify the areas that are underperforming, and try to improve them.

Since only 8% of UK consumers are reading every marketing email they receive and only 43% read less than half of emails sent by marketers, I think it might be safe to say there is currently room for improvement. 

Therefore, it is vital in planning stages to consider specific goals for each campaign.

Different campaigns may have different metrics dependent upon the aim behind them and ‘conversions’ may be defined differently around this.

A conversion for anything that is commerce enabled is likely to be related to purchases and assigned a monetary value, whilst in some B2B nurturing campaigns, a white paper download or call-back request may be the best measures of conversion and therefore campaign success.

For other campaigns which are engagement driven, conversions may be a little more difficult to define; consider tying up with other channels for this.

For example, the number of social shares or time actually spent on your website in addition to opens and clicks. With advances of many ESPs and other analytics packages, it is relatively straightforward in many cases to view the bigger picture.

To create an estimate of campaign response you can use a spreadsheet model. Set this up to show a best and worst case scenario.

For each, the diagram below gives an example. It shows that with a 100,000 list, modelled response of sales can vary between 149 and 26.

That’s a massive overall attrition, but it shows the value of working hard to maximise opens, clicks and landing page response. 

Email Marketing Spreadsheet Model

Activity and engagement goals

If you are a retailer or you run a transactional site, there will be additional goals you’ll want to set according to developing customers along the loyalty ladder or customer lifecycle:

  • Convert prospects into buyers.
  • Convert first time buyers to repeat buyers.
  • Reactivate lapsed purchasers.
  • Increase penetration amongst demographics. 

Even for non-retailers, you can still model a conversion trail from initial subscribers through to active customers. It’s worth recognizing the different stages of your customer lifecycle and mapping your communication plan accordingly to push recipients through your sales funnel.

For more complex B2B organisations it’s particularly important to track the influence of email on conversion, as for higher value sales it’s probable that the final conversion will come from another channel and possibly even another person entirely.

Tracking engagement over time through a lead nurturing programme will give a good gauge on this, so you should consider mapping out the key stages in your buying cycle and then looking at different and enticing content to edge the recipient onto the next stage.

Value goals

You will also want to evaluate the relative value generated from a campaign, different lists or segments to compare them and isolate problems.

  • Value objectives.
  • Increase revenue/profit per email or thousand emails.
  • Increase purchase frequency.
  • Increase average order value (AOV).
  • Increase range of categories purchased.
  • Maximise lifetime value of list member. 

Benchmarking capabilities

As with other aspects of marketing, you will improve your results if you take time to look beyond your own campaigns at competitors in your sectors and innovators in other sectors.

Dave Chaffey, author of Total Email Marketing, devised the model CRITICAL. He explains: 

A simple but practical approach to assess the types of capabilities you need to assess are ‘CRITICAL’ factors for email marketing success. CRITICAL is a useful checklist of questions to ask about your email campaigns.

CRITICAL stands for: 

  • Creative – This assesses the design of the email including its layout, use of colour and image and the copy.
  • Relevance – Arguably, the most important factor. Use the following question: “Does the offer and creative of the email meet recipients’ needs?”
  • Incentive (or offer) – The WIFM factor for the recipient or ‘what’s in it for me?’ What benefit does the recipient gain from clicking on the link(s) in the email?
  • Targeting and timing – Targeting is related to relevance. Is a single message sent to all prospects or customers on the list, or are emails with tailored creative, incentive and copy sent to different list segments?

    Timing refers to when the email is received – time of day, day of week, point in the month, even the year. Does it relate to any particular events? There’s also relative timing: when it’s received in conjunction with other marketing communications (this depends on the integration).

  • Integration – Are email campaigns part of your integrated marketing communications? Questions to ask include: Are the creative and copy consistent with my brand? Does the message reinforce other communications? Does the timing of the email campaign fit with offline communications?
  • Copy – This is part of the creative and refers to the structure, style and explanation of the offer together with the location of hyperlinks in the email.
  • Attributes (header attributes of the email) – Assess the message characteristics such as the subject line, from address, to address, date/time of receipt and format (HTML or text). These can also influence deliverability of the message if they contain the wrong structure or keywords identified as spam.
  • Landing page – The effectiveness of the landing page in terms of communications’ consistency and simplicity. 

Auditing and benchmarking email programme effectiveness

In our Best Practice Guides we advocate assessing your current digital marketing capabilities using capability maturity or stage of adoption models.

We first used this approach in our Managing Digital Channels Best Practice Guide. Econsultancy subscribers have told us that they find these useful since they enable organisations to:

  1. Review current approaches to digital marketing to identify areas for improvement.
  2. Benchmark with competitors who are in the same market sector / industry and in different sectors.
  3. Identify best practice from more advanced adopters.
  4. Set targets and develop strategies for improving capabilities as part of an improvement roadmap.

Evaluation glossary. DMA definitions for email marketing evaluation

Unfortunately, all email broadcasting systems use slightly different definitions of measures, so it’s important to understand and define a standard for a consistent comparison.

Without this you may notice a change in your company benchmark if you change platforms. This may not be due to a change in performance; purely a change in how performance is shown.

The DMA standards defined by the Email Marketing Council are a good place to start.

(These are actually just handy to remember, if you're ever not sure.) 

  • Hard bounce rate. The recipient does not see the email due to invalid email addresses, domain failure, ISP blocked etc.
  • Average hard bounce rate - the number of hard bounces divided by the number of emails delivered (%).
  • Soft bounce - the email address is valid but the recipient does not see the email because of a temporary delivery problem, inbox full, server down etc.
  • Average soft bounce rate - the number of soft bounces divided by the number of emails delivered (%).
  • Average total clickthrough rate - the number of total clicks divided by the number of emails delivered (%).
  • Conversion rate - the number of ‘take-ups’ resulting from the email activity, e.g. number of completed transactions from a cart or downloads of a whitepaper. Only includes data that is clearly based on known responses to emails.

    For our purposes, that means data received within 90 days of the issuing of the email campaign. Responses after this date are not included.

  • Deliverability - there are two main ways in which deliverability should be measured:
    1. Returned email deliverability. Volume of emails sent less the number of bounces (soft and hard bounces) received.
    2. Inbox deliverability. Volume of emails delivered to the inbox as opposed to the spam folder or not delivered. Email certification company Return Path refers to this as ‘inbox placement rate’ or ‘acceptance rate’ – the percentage of emails that make it to the inbox.

For more email best practice advice, check out our recently published Email Marketing Best Practice Guide.

Ornaith Killen

Published 5 May, 2014 by Ornaith Killen

Ornaith Killen is part of the Econsultancy research team.  Follow on Twitter @ornaithk.

14 more posts from this author

Comments (3)

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Stephen

Hello Ornaith,

Thanks for this insight on the effectiveness of email marketing campaigns.

When reading so many statistics about the benefits and ROI of email marketing (and why so many businesses should not overlook its impact), it’s interesting that taking the extra step to actually improve the effectiveness of the campaigns and to get the most out of the email marketing efforts is not as common practice.

I assume this is because most companies don’t have the staff to tackle a project that is as time-consuming as analyzing results and determining the steps necessary to improve success rates.

For the businesses that do conduct email marketing, it’s overwhelming enough to create goals for a campaign, write the copy, design the emails, generate leads, etc.

So, simply getting through this stage can feel like a win. I imagine this is especially true for small businesses.

over 2 years ago

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Justin Belmont

Great article! Email campaigns can be really effective marketing tools, but it's important to understand how to do them properly. I especially like the CRITICAL approach - that's really interesting. Check out some of our tips for email marketing: http://blog.prosemedia.com/4-helpful-tips-for-email-marketing/

over 2 years ago

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Graham

Ornaith you hit this right on the head. Great advice. This is the first article I've seen that follows email marketing PAST open + click rates. You've got to look at website activity and revenue related conversion metrics.

I think you'd like this, it goes hand in hand with what you've worked out here. It's a very simple and free calculator for modeling marketing metrics including email marketing here:
http://www.thoughtsinaction.org/tools/marketing-tracking-tools/email-marketing-tool/

Just plug in your metric and conversion data to model revenue expectations and volume of emails to reach a revenue goal.

Feel free to leave suggestions on improving it, hope it helps-
Graham
Thoughts In Action

over 2 years ago

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