February 05, 2007

E-Mail Marketing: Success Or Apathy?

Assume that your average e-mail marketing program has the following metrics:
  • An open rate of 26%.
  • Among those who open the e-mail, 30% clicked-through the e-mail to your website.
  • Among those who clicked-through to your website, 2.8% purchase something.
When we multiply the metrics together, we learn that 0.26 * 0.30 * 0.028 = 1 in 458 customers who received the e-mail decided to purchase something on your website.

Considering that the marketing cost of e-mail is virtually free, the ROI of your e-mail campaign is utterly spectacular. Woo-hoo!

Let's take a second look at the metrics of your campaign:
  • Nearly three out of four of the people who received your e-mail didn't even bother to open it.
  • Only 0.26 * 0.30 = 7.8% of your list cared enough to visit your website.
  • Just 1 in 458 customers purchased something, a 0.2% response rate.
Do you consider your campaigns a success, if it had a spectacular ROI, but was completely ignored by three out of four recipients, and only harvested one purchase among four hundred and fifty eight of your loyal customers?

What do you pay more attention to, the outstanding ROI, or the complete apathy of your customer base?

1 comment:

  1. Those wouldn't be good results at all.

    The important thing to remember is that you should be limiting the communication to your customer base.

    An email with response rates that low means you won't be able to re-email them something else easily.

    If you 'only' have a couple of thousand interested customers, you need to take better care to keep them interested.

    Click throughs are a good measure of that interactivity - needs to be kept as high as possible. Best measure of trust are the number of people opening your emails. The more rubbish you chuck out, the less they'll actually read.


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