Prove Your ROI

Prove Your ROI: Measuring Performance to Maximize Email Investment

Guy Hanson [email protected]

www.returnpath.com

uk.linkedin.com/in/guyhanson

@GuyHanson, @ReturnPath

Current Email Benchmarks

Source: DMA National Client Email Report 2015

90% of program owners said email marketing performs a very important / important strategic role for their businesses

Source: DMA Response Rate Report 2015

82% of marketing programs employ email for promotional campaigns


Almost 2/3 of marketing budget holders will be increasing their email spend in 2015

Why is email core to your business?

• Our business’ primary revenue source is directly linked to email operations (20%)

• Email is a critical enabler of our products and services (60%)

• Email indirectly impacts our business performance (20%)

Source: SFMC State of Marketing Report 2015

Source: Econsultancy Email Marketing Industry Census 2014

3 out of every 5 respondents

attribute at least 10% of total sales

to their email programs


When house lists are used, email has the lowest Cost per Acquisition (CPA) of the media types in

this study


Part of the reason behind the

continuing popularity of email must be its ROI, which is the

highest of the media investigated

in this study

Source: Econsultancy Email Marketing Industry Census 2014

66% of email program

owners rank email as

Excellent or Good for ROI effectiveness

Measuring Email Performance Metrics

“If you can’t measure it, you can’t

manage it”Peter Drucker

Source: Econsultancy Marketing Budgets Report 2015

2 out of every 5 email program owners rate their ability to measure ROI from email as Good . . .


. . . but almost 50% aren’t confident they can calculate revenue from their email marketing activities . . .

Source: Econsultancy Marketing Budgets Report 2015

. . . and the inability to measure ROI is the third largest barrier to securing

digital investment

What are the key metrics you use to evaluate effectiveness of your email programs?

DMA National Client Email Report 2015


Average Order Value

$182

Revenue per Email

$0.08


Over 50% of email revenue is generated by

segmentation

Another 30% is being produced by triggered

emails – almost doubling in just 12 months!

“Does the majority of your email marketing

revenue and engagement come from

triggered emails? Anecdotally, marketers

tend to hit this mile-marker when more than 5% of their email volume

is triggered emails”Source: Mediapost,


Driving sales, acquisition, and lead

generation is the primary objective for

54% of email programs

Engagement, retention, and brand awareness accounts of a further 40%

Source: DMA Email Tracking Report 2014

Just under half of consumers (48%) now say they will

click-through from an interesting email,

compared to 64% 3years ago


3 out of every 4 mobile email subscribers will either occasionally/regularly read the subject

line and then delete


Almost 20% of email subscribers will register a

spam complaint as a result of a bad customer

experience, or loss of trust in the brand

Calculating Email Effectiveness & ROI

Metric Baseline UpliftHard Bounces 0.3% 0.27%

Unsubscribes 0.125% 0.113%

Complaints 0.075% 0.068%

Disaffection Index 0.50% 0.45%

Metric Baseline UpliftList Size 1,000,000 1,000,000

Sends Per Annum 104 104

Total Emails Sent 104,000,000 104,000,000

List Churn 520,000 468,000

CLV of Address $8 $8

Depreciation $4.16M $3.74M

Effectiveness & ROI The Disaffection Index

Effectiveness & ROI Brand Value

• Companies are spending . . . 38% of their total marketing budgets on digital

• On average, 12% of digital marketing budgets are allocated to email

• Almost $4 in every $10 spent on digital . . . has a brand-focused objective

• An email program that supports a $10M brand is likely contributing ± $200K

Sources: Marketing Charts /eMarketerSource: Econsultancy Marketing Budgets Report 2015

Effectiveness & ROI External Measurements

Strategies to GrowEmail ROI


Discounts are the single biggest

reason subscribers sign up to receive

emails (38%)

Strategies to Grow Email ROI List Growth

Source: Fastmap Consumer Attitudes to Data




Source: RP Labs Frequency Finder


Source: Experian Marketing Services - 4 Tips to Smarter Email Marketing

Source % Primary % Secondary Dead

A 17% 60% 23%

B 18% 59% 23%

C 8% 30% 62%

D 11% 44% 45%

E 39% 43% 18%

F 19% 64% 17%

Revenue

$7,520

$7,600

$3,680

$5,280

$9,680

$8,160

Strategies to Grow Email ROI Get Delivered

IP Address Permanence

Spam Complaints

Unknown Users

Infrastructure

Spam Traps

Subscriber Engagement

Strategies to Grow Email ROI Get Delivered

Source: Return Path Case Study Red Letter Days

Strategies to Grow Email ROI Frequency Optimization

Strategies to Grow Email ROI Frequency Optimization

Source: E-Mail Tipps - What’s your best email frequency? Here’s the math : Mailchimp - Sending Frequency: More Is Not Always Better!

Strategies to Grow Email ROI Triggered Emails


Source: Epsilon Q3 2014 Email Trends & Benchmarks

“Triggered open rates were 76.7% higher than BAU

emails, with triggered click rates reporting 151.9%

higher”


Source: RP Labs Strategy Mapper

Strategies to Grow Email ROI

Win-Back

Strategies to Grow ROI Email Win-Back

Source: Econsultancy Cross-Channel Marketing Report 2014

70% of companies say it’s cheaper to retain a customer than acquire one and 49% say that, pound for pound, they achieve better ROI by investing in relationship marketing over acquisition marketing.

Source: Experian Marketing Services – 4 Tips to Smarter Email Marketing

Metric Actives Inactives

Subscribers 100,000 100,000

Revenue per Email

$0.08 $0.00

Email Frequency 2 x per week 0 x per week

Revenue per Year $832,000 $0

Revenue Opportunity $116,480

“The overall Read rate for win-back emails was 14%”

Strategies to Grow Email ROI Win-Back


Think Mobile

Strategies to Grow Email ROI Think Mobile

Source: Yesmail

Emails that make use of responsive design techniques

see an average uplift in click-to-

open rates of 21% for mobile

subscribers

Strategies to Grow Email ROI Think Mobile

Source: Knotice


Eliminate Fraud

Strategies to Grow Email ROI Eliminate Fraud

Source: Return Path EFP Security Report

Strategies to Grow Email ROI Eliminate Fraud

Source: Marketing Charts - Low Click-Through Rates A Top Challenge For Email Marketers

A meaningful call-to-action offer is rated by 65% of program owners as the most effective driver of

email click-throughs

Resources

• Return Path Placement Benchmarks

• Return Path Email Win-Back Programs

• Return Path EFP Security Report

• DMA (UK) Email Tracking Report 2014

• DMA (UK) National Client Email Report 2015

• DMA (US) Response Rate Report 2015

• Econsultancy Email Marketing Industry Census 2014

• Econsultancy Marketing Budgets Report 2015

• Econsultancy Cross-Channel Marketing Report 2014

• Experian Marketing Services Quarterly Email Benchmark Report Q1 2015

• Experian Marketing Services 4 Tips to Smarter Email Marketing

• Salesforce Marketing Cloud State of Marketing Report 2015

• Epsilon Q3 2014 Email Trends & Benchmarks

• Fastmap Consumer Attitudes to Data

Prove Your ROI: Measuring Performance to Maximize Email Investment

Guy Hanson [email protected]

www.returnpath.com

uk.linkedin.com/in/guyhanson

@GuyHanson, @ReturnPath

Prove Your ROI

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