If converting leads into paying customers dominates your thoughts all day and night, you might be a small business owner. Better yet, you are a smart business owner because lead conversion can make or break your success in the market. You can have the best customer service and the most useful products, but it means nothing if you can't convince people to take a look and make a purchase.
Email marketing works for every kind of business, whether you sell products or services, cater to businesses or individuals or operate internationally or locally. If you have a way to collect email addresses (legally, of course, which means subscribers agree to receive email marketing communication from you), then you can take advantage of email marketing.
Like any other marketing or lead-conversion strategy, you need a way to measure its success. Calculating an email conversion rate will tell you the percentage of people who did what you wanted them to do after reading your email, whether it was to download information or make a purchase.
Email Conversion Rate Formula
When you employ email marketing, you should have a goal for each email. Your goal may be getting people to read a new blog post, share your page on social media, or purchase a new product. The basic email conversion rate formula is the number of people who completed your goal divided by the total number of people who received your email. Then, multiply that number by 100 to get a percentage.
However, some people receive emails but never bother to open them. You might like to take a look at the conversion rate among people who took the time to read your email. To do this, just divide the number of people who completed your goal by the total number of people who opened your email and multiply by 100.
To do these calculations efficiently and accurately, you will need to use tools that help you track data regarding the emails you send.
Tools for Tracking Email Conversion Rates
First, you will need a way to track your goals. Google Analytics allows you to set up website-based goals in its interface, which will help you know whether people visited a certain web page, filled out a certain form on your site, etc. However, for other goals, you will have to get creative. If you want people to follow you on Facebook, for example, then calculate the average number of Facebook followers you get each day (or week) before sending your email and then see how many more you receive after sending an email that asks for followers.
Also, consider using an email management service like Mailchimp or Constant Contact to easily obtain analytics about your emails, even if you intend to send simple text-only emails rather than the professional-looking newsletters these platforms allow you to create. These tools will make it simple to manage and segment your recipient lists as well as to know how many people actually open your emails and click on the links inside.
Without tools like these, you can manually manage your contacts with a spreadsheet, but you will be left guessing as to how many people open the email or click on the links. That means you won't have insight on how people interact with your emails, which in turn helps you understand what's working and what's not. Are they opening, clicking or unsubscribing?
Email Open Rate
The email open rate is calculated by dividing the number of people who opened the email by the number of recipients and then multiplying by 100. A high email open rate not only means you successfully wrote a compelling subject line but also indicates that people are eager to interact with your brand in the first place.
There is a possibility that your emails aren't being seen because they have been delivered to the spam folder. However, more than likely, if no one opens your emails, it is because your subject lines need to be more intriguing to pull people in. On the other hand, if your email open rate suddenly plummets without much change in your subject line strategy, people who opened emails in the past may have been disappointed in the quality of the content and are not interested in them anymore.
That is why it's so important to have an email strategy right away. You don't want to risk losing people's interest due to delivering poor-quality content. Understand your brand voice and what you want your email marketing campaign to achieve before you map it out and bring it to life.
Email Unsubscribe Rate
Some people choose to just ignore emails in which they aren't interested, leaving them unopened. Others actively unsubscribe. Your unsubscribe rate should ideally remain as close to zero as possible, but it is inevitable that some people will unsubscribe. If you have a higher rate of people jumping ship on your email campaign, you will want to do some investigation.
You can add a very simple survey to your unsubscribe process that asks for feedback. What could you have done better to retain that person's interest? You won't know until you ask.
Think about whether you had quality leads in the first place. Did you get a ton of email signups during a promotional event or contest? Maybe people signed up only for a discount code or a chance to win a prize. Not everyone who subscribes to your email campaign is invested for the long haul.
Email Click Rate
Your email click rate can be considered another stepping stone in your conversion funnel. To calculate the click rate, divide the number of people who clicked a link inside the email by the number of people who opened the email and multiply it by 100. A high email click rate shows that people are not only actively reading your emails but are also interested in at least taking a look at your products and services.
Having a high open rate is a great sign, but it doesn't translate to income. You need people to click on a link to your website and eventually make a purchase. If plenty of people open the email but never click a link, then your content is not persuasive. Try to be very clear about your call to action so they know exactly why you are directing them to your website and where they need to click to get there.
Email design could also be a problem. Would you read a huge block of text with no punctuation? Although it is an extreme example, it helps to show you the importance of design elements in email campaigns. Everything from the use of short sentences, bullet points, pictures and buttons makes a difference.
Following the Click Trail
Say you have a series of emails with a high open rate and high click rate, but people still aren't completing your end goal of contacting you, making a purchase, etc. At this point, you will want to head over to Google Analytics to see where your leads are getting stuck on your site.
In Google Analytics, click on the Behavior tab and then click Behavior Flow. This will show you which other pages users navigate to from their landing page. It will also give you information about how many people left your site on a certain page. Follow the click trail to understand which page(s) made visitors say "forget it" instead of completing your desired goal.
If your web pages don't have a persuasive design or persuasive copy, leads will get stuck in the conversion funnel. Your email conversion rate will remain stagnant until leads complete a goal. The conversion funnel may start with your email campaign, but it typically finishes on your website. Therefore, be sure to look at the big picture and don't spend all your effort on the email campaign only to fall short on your website.
Understanding the Conversion Funnel
Speaking of conversion funnels, how well do you understand the role your emails play in your conversion funnel? The great news is that you are already talking to people who are interested enough in your business to receive email updates. You can stay top of mind as a brand and help them understand why they should buy your product or choose you as a service provider simply by appearing in their email inbox on a regular basis.
What kinds of things can you say in your emails to help leads become buyers? Quite a variety, as it turns out. Start by providing a helpful newsletter with tips that demonstrate your authority, expertise and professionalism. Then, branch out into client testimonials, before-and-after pictures, special discounts for subscribers, company news, etc.
Always prioritize your call-to-action so that readers understand your goal. You don't need to beat around the bush or try to slyly coerce readers to do what you want. If you earn their trust and provide a great product or service, they will complete the call-to-action.
Email Marketing Conversion Rate Benchmark
Email marketing is an art form, and it requires plenty of attention to detail to get the words right, the design correct and the conversion funnel fully organized. Even when you get good at email marketing, what kind of conversion rate can you expect?
It actually depends on your industry. Looking at email conversion rates by industry will help you understand if you are doing well, performing at an average level or totally missing the mark. Mailchimp has a resource table that shows various email marketing conversion rate benchmarks by industry to help you out.
However, Mailchimp's data is limited, including open rates, click rates and unsubscribe rates. It does not show how many email campaigns successfully converted readers toward the business's end goal. Your competitors are likely to keep that information well hidden. Do your best to analyze industry open rates and click rates and compare them to your own while also being smart about how your email strategy complements your overall conversion funnel.
Improving Your Email Conversion Rates
As with most things in life, improving email conversion rates is multifaceted. It requires more than just a great subject line, compelling copy, a clear call-to-action, great design and an optimized landing page. You also need to have a great selling proposition in the first place.
Another consideration includes how well your emails load on mobile devices. You can't bog down an email with large images or GIFs and expect your increasingly impatient audience to wait around for it to load. With faster and faster technology, our attention spans have gotten shorter and shorter. Make every second count.
Finally, don't feel discouraged if your subscriber list is quite small. Continue to build it, but understand that quality is far more important than quantity when it comes to successful email marketing campaigns. Keep putting out quality emails, and it will become easier and easier to craft campaigns that promote your brand, engage subscribers and generate income for your business.