What is a decent email marketing response rate?

Despite all the data you’ve acquired from measuring your email marketing campaign – deliverability, open-rates, conversions – how do you know whether this data compares favourably with your competitors’ efforts or not?

Imagine you’re a travel company running an email campaign and your figures say you currently have a 20% open rate with a 3% click-through rate, how do you know if this is good or bad?

To the non-professional marketer the above figure seems quite low, but according to a variety of sources including MailChimp this is that particular industry’s average.

Using our own 200 page Email Marketing Best Practice Guide I’m going to try and answer the question of what makes for good email marketing benchmarks and hopefully highlight some figures that may act as a handy reference.

By Christopher Ratcliff June 17th 2014 12:37

Important response measures

First of all it’s important to know which metrics you should be measuring in order to determine the effectiveness of your campaign.

These are some of the most important response measures that will be reported for an email campaign by your email service provider.

Bounce rate: this can be split into hard bounce rate (the recipient does not see the email due to invalid email addresses or domain failure) and soft bounce rate (the email address is valid but the recipient does not see the email because of a temporary delivery problem, inbox full, server down etc.)
Conversion rate: the number of ‘take-ups’ resulting from the email activity. For instance the number of completed transactions from a cart or the download of a document.
Deliverability: there are two main ways in which deliverability should be measured – returned email deliverability (volume of emails sent minus the number of bounces received) and inbox deliverability (volume of emails delivered to the inbox as opposed to the spam folder or not delivered).
Average unique open rate: unique opens divided by number of emails delivered.
Opt-out: when a recipient unsubscribes or opts out of further communications. There’s more on this in our post on tips for managing email unsubscribes.
Response rate: the number of actual responses made as a result of the email campaign.

In the planning stages of any campaign it’s vital that specific goals are considered for each one depending on its desired outcome. A conversion can mean anything from a product purchased to the downloading of a white-paper to simply directing the recipient to a new social channel. The above examples are just a small band of metrics that you can use to measure performance.

Here’s an example of a model showing the best and worst case scenarios from an email marketing campaign. Obviously this is quite optimistic.

Blowing email’s trumpet

As an email marketer you may find yourself under-recognised, as many companies fail to accurately attribute success in an increasingly multichannel world.

Email agency Alchemy Work set out to help a retailer who wanted to better understand the true contribution of its email marketing strategy. In particular the influence email has on conversions from other channels.

Alchemy Worx was able to demonstrate that even unopened emails were driving brand awareness and sales in other channels. It was also able to prove that open rates were a very poor indicator of email’s value to its business.

Here you can see that sending an email results in revenue uplift across all channels and clearly demonstrates that email engagement is not limited to conventional open and click  measurement.

The charts also show the impact of the ‘nudge effect’ of email on other channels. The additional revenue generated as a result of the email being received shows the brand impact of email.

So whilst open rates for emails may have declined over the past few years as the channel has matured, this study highlights that in terms of revenue generation it’s still an absolutely vital tool.

Email marketers however should not be relying on open or click-through rates as the sole gauge of success, but rather looking at conversions and finding a way to relate their activity to revenue generated across all online marketing channels.

Stats from third party email service providers

I’m including a few studies from a variety of email providers to highlight the differences in open-rates and click-throughs by industry.

This first lengthy list is from MailChimp. It’s based on a selection of its clients, which have at least 1,000 subscribers, with hundreds of millions of emails scanned and tracked.

Click image for the full list

This is from a 2014 survey by Sign-Up.to, it shows the average open and click through rates for UK SME campaigns. It’s fairly similar to the MailChimp study.

Finally here is Silverpop’s email marketing metrics benchmark study for 2014. There’s lots of data in the linked Pdf but here for your pleasure are the tables for unique open rates and click-through rates.

How the travel industry uses email marketing

Because I’m a sucker for punishment, two weeks ago I signed up nine different travel websites in order to see how each company uses email marketing.

Here are the sites I chose: Easyjet, Ryanair, Thomas Cook, Secret Escapes, Voyage Prive, Expedia, Mr & Mrs Smith, The Weekenders and Skyscanner.

I’ll be looking at the frequency of emails, the use of subject lines, the email content itself, special offers, editorial voice, personalisation, relevance… All of the many tools that a company can utilise to coerce the recipient to open up an email or even engage with it.

Will this be the equivalent of leaving a skylight open during a storm, or your front door open during a riot?

Let’s take a look at my inbox, to see how it looks right now, two weeks after sign up. Please note, in a rare moment of sensible thinking, I set up a different email address to do this.

Article Personalisation

Agile creative to improve email marketing conversion rates

Agile email creative is the formatting of images not before send, or at send (with automated or dynamic content) but at the moment the customer opens or re-opens an email.

This allows one to change pictures in an email depending on a host of variables, on their own or combined, in a rules-based system.

A lot of what this agile creative can achieve boils down to improving the user journey when they open an email. So, for example, an image can present latest availability of a product, so that when the customer clicks through from a product image, she isn’t surprised by lack of stock and doesn’t subsequently distrust brand comms.

I’ve previously talked to Movable Ink, a specialist in simplified email build and agile email creative (see this post for an overview and some great comments). Recently I also spoke to Matt Hayes of Kickdynamic, another agile email specialist.

We discussed the possibilities of the technology and how, although not a complex premise, agile email is enlivening the channel whilst increasing conversion rates from email marketing.

In this post I thought I’d detail some more examples of agile email creative and discuss what benefits they hold.

Article Email and eCRM

How do marketers manage their mobile email channel effectively?

More than half (52%) of 18-34 year-olds have clicked through to a website from a mobile email, so it’s therefore imperative for email marketers to ensure their communications are suitably optimised for all mobile devices.

This stat comes from all the way back in 2012. Since then different studies by different companies have revealed similar numbers: 68% of people use their mobiles for email; 41% of emails are opened on mobile devices; the latest study I could find is by Litmus revealing that in 2013 48% of all emails were opened on mobile.

So how do marketers manage this progressively more popular channel effectively?

I’ll be taking a look at our recent report Bridging the Gap in Email Marketing, written by Morag Cuddeford-Jones, in which interviews were conducted with digital marketing professionals across a range of businesses, exploring the challenges and opportunities for marketers who are committed to taking their use of email to the next level.

What is a decent email marketing response rate?

Important response measures

Blowing email’s trumpet

Stats from third party email service providers

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