Email and SMS Metrics To Help You Grow Your Business

Email and SMS are two great ways to communicate with your audience to make them aware of new products, special deals and discounts, and other types of content that may be of interest to them. When you use email and SMS as part of your owned marketing strategy, it’s important to test, iterate, and continue to try new tactics and approaches to figure out what will best resonate with your audience.

But how do you know what’s working and what’s not? That’s where goals, objectives, key performance indicators (KPIs), and email and SMS metrics come into play. But metrics are only one component of measuring how well your email and SMS marketing programs are performing.

Before we dig into specific email and SMS metrics, let’s first define what goals, objectives, KPIs, and metrics are and what’s different about each of them.

 

What’s a goal?

A goal is something you hope to achieve if you meet all of your objectives and KPIs, which I’ll define further in a moment.

Goals can be something as simple as “grow revenue from email campaigns by 30 percent by the end of Q1.”

Goals should be specific, measurable, actionable, relevant, and timely (SMART). Let’s break down this particular goal within the SMART framework:

  • Specific: Increase revenue by 30 percent.
  • Measurable: You can see if your revenue is increasing by looking at the sales driven by your email campaigns.
  • Actionable: You have several levers you can pull to drive revenue: you can test different copy in your emails, you can try different calls-to-action (CTAs), and you can experiment by sending specific emails to different lists and segments.
  • Relevant: The goal is relevant, especially if it ties into a broader company goal to grow revenue.
  • Timely: There’s a clear timeline to achieve this goal: by the end of the first quarter. You can even break this goal down into smaller milestones, such as weekly or monthly revenue goals that accumulate to the primary goal and its timeline.

 

What’s an objective?

An objective is a specific measure of progress towards your goal. These are often the tangible results that can be quantified and they tend to be things that are more short-term in nature versus goals, which tend to be more long-term in nature. When you’ve met all your objectives, you’ve reached your goal.

Goals can have one or more objectives. For example, if your goal is to increase revenue by 30 percent by the end of Q1, you may have a specific email marketing campaign objective to achieve a five percent increase in clickthrough rates (CTRs) by the end of January.

To accomplish this objective, you may want to experiment with different CTAs, email lengths, images, and more to find what works and what doesn’t.

An objective will usually be measured by one or more KPIs, which I’ll also define in a moment.

 

What’s a KPI?

A KPI, or key performance indicator, is defined as a “measurable value that demonstrates how effectively a company is achieving key business objectives.” A business objective may have one or more KPIs that can be used to track the status of the objective. A KPI is a metric that is used to track progress towards an objective, but not all metrics need to be included as KPIs (as this can lead to analysis paralysis).

In the example above, the email CTR (click through rate) would be one KPI, along with the total number of clicks and, possibly, the open rate. You wouldn’t want to look at metrics like the bounce rate or open rate because they’re irrelevant to this objective (although they will likely be relevant to the goal and may have their own objective with their own KPIs). There would likely be a separate objective that would include examining ways to get more people to open the email and additional objectives to get people to convert on the site, all of which would have different KPIs.

 

What’s a metric?

A business or marketing metric, as defined by Klipfolio, is “a quantifiable measure that’s used to track and assess the status of a specific business process.” These business processes can include things such as your sales funnel, support response time, advertising campaigns, and, yes, your email and text messaging campaigns or automation.

A metric is simply a unit of measurement, whereas a KPI is a metric that is valuable to the achievement of an objective.

Now let’s take a look at some specific email and SMS marketing metrics. We’ll then discuss some of the email and SMS marketing objectives and metrics you should use to define your KPIs.

Email Marketing Metrics

Email marketing metrics can help to inform your progress towards a particular goal or objective. Below are a list of some of the most common email marketing metrics and how you can use them.

  • Sent: The total number of emails sent out by your email platform. If you have a list of 1,000 contacts and you try to send to a list that includes all of them, you may notice in the email campaign that the “sent” number is lower. This indicates that some email addresses may have previously bounced or filed a spam complaint and the system chose to not send to them again.
  • Received / delivered: This is the total number of people who successfully received your email. Sometimes these terms are used interchangeably, though whether the email is received or successfully delivered is the same thing. Throughout this article, you’ll see the term “delivered,” but if you read about email metrics anywhere else, you may see either of these two terms used with the same context.
  • Delivery rate: The total number of emails delivered divided by the total number of emails sent.
  • Spam: The total number of people who clicked the “report as spam” button in their email browser or marked your email as junk. You should suppress these people and avoid sending them any more emails since spam complaints can drastically affect your ability to get into legitimate users’ inboxes.
  • Spam rate: The total number of people who complained about your email being spam divided by the total number of people who received your email.
  • Opens: The total number of people who opened your email. Most email marketing platforms have automatic open tracking, which includes a small pixel that, when loaded, sends a signal back to your email platform indicating that the email was opened.
  • Open rate: The total number of people who opened your email divided by the total number of people who received your email.
  • Bounces: These are emails that were unable to be delivered, either due to a technical issue, a non-existent email, or another issue. Bounces can be classified as hard and soft bounces.
    • A hard bounce is a permanent issue, such as when an email is sent to an address that doesn’t exist, is closed, or the recipient has completely blocked delivery. Because these bounces usually indicate an invalid email address, you should remove or suppress the email from your list.
    • A soft bounce is a temporary issue, which could indicate that the user’s email inbox is experiencing technical issues, is full (not common anymore), or that the message you’re sending is too large (also not common). These types of bounces can be retried several times, but if you continue to send and get soft bounces, you should suppress the contact.
  • Bounce rate: This is the number of people who bounce (soft or hard) divided by the total number of people who were sent the email.
  • Clicks: The total number of clicks on a CTA or a link in your email. You should track the number of clicks on each link and button to determine what works best for your audience.
  • Clickthrough rate (CTR): The total number of clicks divided by the total number of people who received your email. As a best practice, look at unique clicks since some people may click on an email more than once or click on more than one link in your email.
  • Conversions: A conversion is any action that you believe is valuable. It can vary based on the goal and objectives of your email campaign. You may have one campaign to sell a certain product. In this case, the conversion would be a sale of that product after somebody received and/or clicked on your email. You may have another campaign designed to get people to register for a free event you’re hosting. In this case, a successful register would be the conversion.
  • Conversion rate: The percentage of people who converted divided by the total number of people who received your email.
  • Unsubscribes: The total number of people who unsubscribed from your email list after receiving a particular email campaign.
  • Unsubscribe rate: The percentage of people who clicked “unsubscribe from list” divided by the total number of people who received your email
  • Forward / shares: This is the number of times somebody has clicked a forward or “share to social” button on your email.
  • Forward / share rate: This is the percentage of people who have forwarded your email or shared your email content divided by the number of people who received your email. One thing to bear in mind is that this rate is only applicable if you have a “forward to a friend” button or a “share to social” button in your email. If a user forwards your email directly via their email browser, you won’t be able to tell that it was a forwarded email. When the forwardee opens the email, it will look as if the forwarder opened the email again.
  • Return On Investment (ROI): This is the total amount of money all of your email campaigns or automations have made during a specific period of time minus the amount you spent to send your emails emails. For example, if you made $10,000 dollars in a month and your Klaviyo subscription cost you $100, your ROI would be $9,900.
  • Mobile opens: The total number of people who opened your email on a mobile device.
  • Mobile open rate: This is the total number of people who opened your email on a mobile device divided by the total number of people who received your email. According to Upland Adestra, 61.9 percent of all email opens happened on a mobile device as of July 2019. Depending on your list and segments, this percentage may be higher so it’s vital to ensure you’re testing all emails on mobile devices and using responsive email templates.
  • Revenue per recipient: This metric is calculated by taking the total amount of money an email send/campaign/automation has made and dividing it by the total number of people who received your email. If a campaign made $10,000 and 1,000 people received the email, your revenue per recipient would be $10. You can further break this metric down into revenue per open (in which people who did not open are not included in the calculation) or revenue per click (in which people who opened but did not click are not counted).
  • Revenue per email: This metric examines the amount of money an individual email campaign or automation has made and it can help you determine the types of emails that resonate well with your audience—if the objective of your email is to sell more products. For example, you may realize that short, to-the-point emails highlighting only one product may perform better than long emails that feature 10 different products.
  • Revenue per subscriber: Revenue per subscriber is the total amount of revenue earned during a specific period of time divided by the number of subscribers you have on your list at that time. This is an important metric to track sinces it indicates the quality of your overall email list. If you sell a product that has a high rate of repurchase and the majority of your email list is returning customers, you can expect your revenue per subscriber to be higher than if you have a list of people who only subscribed to your email newsletter and haven’t made a purchase. You can use this metric to dive deeper into segmentation and personalization to discover which subsets of subscribers are more valuable than others.
  • List growth: This indicates how your email list grows (or shrinks) overtime. Your contact list is one of your most valuable business assets and you should continuously try to grow your list over time so you can engage your contacts with personalized and segmented messages.
  • List growth rate: This is calculated by taking the total number of new subscribers minus the total number of people who unsubscribe, hard bounce, or file a spam complaint and dividing it by the total number of email addresses on your list. For example, lets say your email list size starts at 10,000 at the beginning of the month. During the month, you add 600 new subscribers to your list and also have 100 new unsubscribes or hard bounces. At the end of the month, your email list size would be 10,500 (10,000 + 600 – 100). Thus, your list growth rate would be 5 percent (new subscribers: 600 – unsubscribes/bounces: 100 = 500 / 10,000 = 5 percent list growth.

You can break down any of the revenue metrics above by calculating ROI per recipient, email, etc. To do so, simply use your ROI number rather than your total revenue number.

SMS Marketing Metrics

SMS marketing metrics can help to inform your progress towards a particular goal or objective. Below are some of the most common SMS metrics and how you can use them.

  • Sent: This is the total number of times a particular message has been sent, either through a campaign or an automation.
  • Opens: Unlike with emails, there’s no way for an SMS platform to know when an SMS message is opened. A good benchmark to use is to assume 98 percent of the text messages you send will be opened or at least viewed. If you send 1,000 texts, you can assume that about 980 of them will be seen.
  • Clicks: This is the number of clicks on a link in your text message. A best practice is to include only one link per message and to use a link shortener, which will also allow you to track the click.
  • Click rate: This is the total number of clicks divided by the total number of text messages sent.
  • Conversions: The total number of people who complete the action that your business has determined is valuable. This could be a sale, event signup, or any other action you encourage the user to take.
  • Conversion rate: The total number of conversions divided by the total number of people who received the text.
  • Number of opt-ins: The number of people who gave consent (typically on a signup form).
  • Number of opt-outs: This is the total number of people who have opted out of receiving text messages from you. Usually when somebody replies “STOP” to a message, this will opt them out of receiving additional text messages from you.
  • Opt-in source: This is the source for where you gathered the users’ consent to send messages. This could include your checkout page, a popup box on your site, a paper form (such as if you met them at an event), etc. You may have different areas where a user can opt in to receive texts from you. You may have a standalone form on a landing page where customers can sign up to receive discount notifications, a popup or flyout form, or a checkbox on a checkout form. It’s important to track where people are opting in from so that you can make informed decisions to grow your text list.
  • Number of resubscribes: The number of people who opted out of a text but then opted back in later.
  • Revenue generated: This is the total amount of revenue you’ve made from people who have clicked on links in your texting campaign. Learn more about SMS attribution here.
  • ROI: This is the total amount of revenue generated by SMS divided by the total cost to send the text messages. For example, if you send 1,000 texts which generate $500 in revenue and it costs seven cents per message, you’ve spent $70 to make $500 so your ROI is $430.

 

Email marketing and SMS marketing objectives and KPIs

Now that you’re aware of the wide variety of email and SMS metrics that are available to help you measure your performance, let’s talk about some objectives and KPIs you can set to track your progress towards your goal.

Let’s say you want to grow your email and/or SMS list by 1,000 subscribers by the end of the year—this would be your goal. And you may have some objectives, too:

  1. Increase subscriptions on your checkout form
  2. Increase subscriptions from referrals
  3. Decrease unsubscribes
  4. Add additional conversion opportunities to your site
  5. Increase subscriptions from Facebook lead ads

 

Each of these objectives will have very different KPIs. Let’s take a look at each of them:

 

KPIs for increasing subscription on checkout forms:

  1. Number of subscribers coming through checkout form
  2. Number of total checkouts
  3. Subscriber rate (subscribes / total checkouts)

To tackle this objective, you have many levers you can pull. You could test out the verbiage of the email opt in button, increase the number of checkouts (which may be a completely separate goal), explain the benefit of subscribing on the checkout form, or change the positioning of the subscribe option.

 

KPIs for increasing subscriptions from referrals:

  1. Number of subscribers coming from referrals (friends, family, and colleagues telling people to subscribe)
  2. Number of total subscribers
  3. Referral rate (number of subscribers referred / total subscribers)

Again, you’ll have several levers you can pull in this scenario. You could send a “refer a friend” campaign to your subscribers to try to boost the referral rate. If you don’t have an automated “share” or “forward to a friend” button on your emails, you could add one to encourage sharing of your content and offers.

 

KPIs for decreasing unsubscribes:

  1. Total number of unsubscribes
  2. Unsubscribe rate
  3. Total number of subscribers

This objective seeks to minimize churn. If you add 1,000 subscribers but can expect to lose about 100 of them due to unsubscribing, you technically need to add 1,100 subscribers to break even and meet the goal. By decreasing the unsubscribe rate, it will make it easier to hit the goal by adding new subscribers since you won’t be losing any.

For example, some tactics you could try to decrease the unsubscribe rate would be to send email less frequently, provide different subscription options (let them choose how often they want to be emailed and what type of content they want to receive), send more highly-targeted, emails, or simply send higher-quality emails that provide real value to who you’re sending to.

 

KPIs for adding additional conversion opportunities to your site:

  1. Total number of website visitors
  2. Total number of website conversion opportunities
  3. Total number of conversions on the website
  4. Conversion rate (conversions / total visitors)

If you’re currently only growing your list by asking people to subscribe at checkout or sign up, you may be missing opportunities higher up the funnel. Some quick examples of conversion opportunities would be to add an exit intent popup that displays when people are about to navigate away from your site and offer an incentive to join your newsletter list.

Another could be a standalone subscription page that you can link to that has a variety of options for people to select to choose how they want to be subscribed. Lastly, you could offer gated content in exchange for an email address—be sure to abide by all local laws and regulations such as GDPR if you’re going this route, as it does not always infer their consent to email and it definitely doesn’t infer their consent to receive texts.

 

KPIs for increasing subscriptions from Facebook lead ads:

  1. Facebook Ad budget
  2. Facebook lead ad impressions
  3. Facebook lead ad clicks
  4. Facebook lead ad submissions
  5. Facebook lead ads cost per submission
  6. Facebook lead ad ROI

Lastly, if you have an advertising budget, you may want to consider paying to acquire subscribers. Facebook lookalike audiences are a powerful way to find people who match the characteristics of your existing subscribers and could be interested in the same content. It’s important to measure ROI of any paid advertising channel (you’d need to know your average revenue per subscriber).

 

Final thoughts

Email metrics, KPIs, and objectives… oh my! This can be a lot to take in, but by taking a metric-based approach to your email and SMS marketing, you’ll be sure to maximize your efforts and know exactly what tactics are working and which can be improved upon in order to better engage your customers and grow your business.

Want to build better relationships with your customers? Check out these SMS marketing tips.

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