Key performance indicators, better known as KPIs, are a category of metrics that directly correlate to business success. Some statistics, like views and impressions, can look impressive, but won’t hold much weight if they don’t become conversions or customers. KPIs help measure your success in a realistic way and can be incredibly useful when determining what is and isn’t working with your email marketing.
Why Tracking KPIs Is Crucial
In any facet of marketing, KPIs are tracked and analyzed to better optimize campaigns. They are the basis of data-based marketing, and anyone who wants to have successful advertising needs to understand their value. If you don’t measure KPIs you cannot improve upon them. Key performance indicators often measure your business’ progress towards a certain goal, and often involve revenue, return on advertising, and customer lifetime value. It is clear that if you don’t track metrics like sales or new customer acquisition, you’ll have no way of knowing how successful your marketing efforts are.
The Top KPIs Every Beginner Should Know
Although some KPIs vary from business to business, there are some that stay constant throughout. KPIs often follow the SMART standard: Specific, Measurable, Achievable, Relevant, and Time-bound. Relevancy is key here, as different businesses will have different metrics specific to their field.Now, let’s examine some KPIs specific to email marketing that can be tracked in tandem with the metrics previously mentioned.
Open Rate
Open rate is a KPI that informs you who is actually opening your emails. This is often shown as a percentage and can be used to separate your mailing list into specific segments based on engagement. This metric is one of the greatest benefits from using email marketing because you get to see who is and isn’t interested in the content you’re producing.
Click-Through Rate (CTR)
Click-Through Rate, in the context of email marketing, are going to be the people on your mailing list who open your emails, and click on some sort of hyperlinked text, image, or button that takes them to your website or promotion. This is a step above open rate and will always be less than or equal to it. Increasing CTR is a great way to get more eyes on your site, and see who is actually engaging with your newsletter and not just opening them.
Bounce Rate
Like checks, emails bounce as well. Your bounce rate refers to the percentage of emails that were sent to your mailing list, but failed to be delivered. This is often a problem with the recipient and not the platform you are using to send. Hard bounces are permanent failures meaning the message has not and will not be delivered. This is often due to an invalid/fake or miswritten email address. Soft bounces are caused by full inboxes or issues with the recipient’s mailing provider. Often, soft bounces will eventually get delivered once the issue is resolved, yet this is harder to track. This metric is great for clearing out your mailing list, or maybe using a different channel to contact customers like SMS if their inbox is full.
Unsubscribe Rate
Unsubscribe rate simply shows you how many individuals have opted out of your emails in the past month or week. If you took a creative leap with this month’s newsletter, but noticed a massive spike in unsubscribe rates, it may be time to return to your old methods. If the unsubscribe rate settles after that, it lets you know what’s working and what isn’t.
Conversion Rate
Conversion rate is one of the most important metrics across all digital channels. It shows you how many individuals have performed a desired action on your site like making a purchase. This can be coupled with various marketing channels like social media or email to see which one is drawing in the most new customers. This is what greatly separates KPIs from other metrics. A social media post could be getting 5,000 views but only causing 100 conversions. Meanwhile, an effective newsletter could only get 2,000 views but lead to 300 conversions. This is why views and other metrics that don’t follow SMART, hold little weight in the grand scheme of your business.
Secondary Metrics Worth Watching
Some secondary metrics that are worth watching include:
- List Growth Rate: Are you gaining more subscribers than you’re losing?
- Spam Complaint Rate: Keep this low to protect your sender reputation!
- Forwarding/Sharing Rate: Tracks how often your newsletters are being shared with others.
These metrics shouldn’t be your main focus, but can still be useful to optimize.
How to Track KPIs
Tracking KPIs has never been easier. Most companies use an email platform to handle their newsletters, and any well regarded one will have a built-in dashboard to help track KPIs. Here at Rise, we recommend using Klayvio!
How to Use KPIs to Improve Over Time
KPIs should be used like any other metric in marketing. Follow the cycle of tracking metrics, using data to spot trends (both positive and negative), then tweak based on what benefits your business’ overall success. If you notice open rates dropping each month, try a different subject line. On top of this, utilize A/B testing and send half your mailing list one subject line, and the other half another. The subject line with the better metrics should then take precedence for future emails. Even if you find both unsuccessful, it doesn’t mean you should return to what wasn’t working before. Remember, always focus on steady improvement, not perfection.
KPIs Turn Guesswork Into Growth
KPIs are great for any business big or small because they give you confidence and clarity that the decisions you are making are effective. Don’t waste time chasing metrics like views and impressions, focus on data that matters and will help grow your business financially.
If you are interested in tracking KPIs for your marketing campaigns but don’t know where to start, contact Rise Marketing Group today for a free consultation!
