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5 Essential Tips for Improving Your Email Marketing ROI

  • Jun 10, 2020
  • Posted By: Robert Duke
  • Category: Articles
5 Essential Tips for Improving Your Email Marketing ROI

Today, almost half of the population uses email globally. According to Radicati’s updated report, there are 3.9 million active email users. And this number is foreseen to hit 4.3 billion by 2023. These numbers indicate how email has become one of the most common communication tools around.

Email, being one of the affordable and effective channels, is embraced by most of the businesses, be it big or small. It helps them to beconnected with the customers and reap more ROI. Email marketing ROI is much more than impressive as it is capable of generating $44 for every $1 spent.

Before learning more about the outcome, let us see what it means to be called email marketing ROI.

What is Email Marketing ROI?

Email marketing ROI (Return on Investment) is one of the popular performance measures used by the businesses to evaluate the effectiveness of their investment. In simple terms, it is a way of measuring whether your marketing strategies produce more income than its cost.

Email Marketing ROI = (Gained – Total Investment) / Total Investment

Some stats below explains the importance of email marketing ROI for any business: [Source – DMA]

  • 18% of top-performing companies generate ROI higher than $70 per $1 spent.
  • 20% of low performing companies are capable of producing ROI of around $5 per $1 invested.
  • Segmented emails can generate 58% of total email ROI.
  • The median ROI of email is 122%, which is 4x higher than social media, paid search, and direct mail.
  • Automated emails comprise 21% of marketing revenue.
  • 62% of organizations produce 30% or more of their digital income through email.


Image Source: DMA

It’s quite challenging for a small business to achieve the numbers mentioned above. However, the average ROI for small businesses stands between 15% and 30%. So, no matter how tiny your business is, you can reach people through this channel by performing email marketing optimization.

What about other businesses? What is a good ROI for them? While the average email ROI is $44 per $1 spent, brands that describe their email strategy as successful produces the average ROI of $42, as per the Litmus report.


Image Source: Litmus

So, the next question is – How to increase the ROI of email marketing? You may have a big list of the subscriber, but that doesn’t mean you can reap maximum benefit out of it. To help you out, we have suggested surefire ways of improving ROI.

1. Grow Your Email List

You should keep a tab on your list growth and loss. You should be aiming to grow your list to expand your market reach and position yourself as an industry expert. The simplest ways to increase the size of your email list are:

  • Optimizing your landing page.
  • Transforming the home page into a lead-generator model.
  • Using pop-overs with exciting gifts to collect their email address.

Believe it or not, email addresses expire by about 22.5% every year naturally. So, it’s essential to pay attention to growing your list and keeping it in a healthy state.

How to Analyze Email List Growth Rate?

Growth Rate = ([(Total newly joined subscribers) – (Total unsubscribes + email or spam complain)] ÷ Total email addresses on your list]) * 100

Example:You have 200 new subscribers and 10 unsubscribes with email or spam complain. If the total number of email addresses on your mailing list is 5,000, the growth rate will be 3.8%.

2. Segment Your Email List

Email list segmentation is one of the proven ways to dramatically increase the performance of the campaign. In fact, according to the DMA report, segmented campaigns are capable of generating a 760% increase in revenue.

Campaign Monitor

Image Source: Campaign Monitor

Once you know you who your customers are, you can quickly segment them into various categories such as:

  • Demographics [age, gender, income level, company position]
  • Geographical area
  • Personal interest
  • Website Behavior
  • Past purchases
  • Position in the sales funnel

You can divide your list according to the categories mentioned above or explain it in the video tutorial. Eventually, the decision of email list segmentation is totally up to you and what works best for you.

3. Personalize Your Messages

Once segmented, you can begin with personalizing the emails to make them more relevant to customers. Personalization nurtures your existing customers, and keep them engaged throughout. As per the DMA report, more than 75% of ROI is produced by personalized campaigns rather than any bulk emails.

Steps to Personalize Your Email:

  • Personalize the subject line and the message based on the customer’s data you have collected.
  • Location, age or gender-specific offers to make the content hyper-relevant.
  • Cart abandonment reminder emails featuring the products on which customers have exhibited their interest.

You can take your personalization to the next level by setting up automated behavioral trigger emails. For instance, if a person purchases from your site, you can use their purchase history to send a follow-up message with a similar product.

Asics show you how to personalize the message based on items in the cart. When a customer adds some item in their cart and abandons it, for whatever reason, Asics sends a reminder email urging them to complete the purchase.


Image Source: Asics

Note: Remember to make your personalized email look personal. That is, the copy should look like it was written by a human, for a human, and not any inbox.

4. Focus on Email Success Rate

Are your emails getting into your recipient’s inboxes? Or is it caught by the spam or junk filters of email services? For your messages to get past these filters, you have to craft high-quality content without using any spam trigger words in it. And, once they get delivered to the right inbox, it is crucial to focus on its open and conversion rate. These metrics define the success rate of an email marketing campaign.

  • Open-rate: Research reveals that 45% of subscribers open your email based on the subject line. That is, if they like it, they will definitely open your message to see what’s inside. Therefore, to increase your email open-rates, you have to focus on optimizing your subject line.

Open-rate = (Number of messages read ÷ Number of emails delivered) * 100

For example, if your team sends out 100 emails with 15 bounce, the number of delivered emails is 85. In that list, if only 40 are read by your subscriber, the email open-rate comes to 47%.

What is the average open-rate for email blasts across all the industries? The answer is 17.92%. That is, the value from 15% to 25% and up is considered as a good open rate. As said above, you can achieve this number by focusing primarily on your subject line.


Image Source: SuperOffice

  • Conversion rate: The conversion rate defines the percentage of subscribers who have either completed the desired action or become a customer, depending on your business goal. The conversion rate can be computed as follows: 

Conversion Rate = (Number of email signups or purchases ÷ Number of delivered emails) * 100

For example, if ten members have signed up for your email newsletter, and out of which, only six emails are delivered to them, the conversion rate of your campaign will be 40%.

According to the Unbounce report, 12% is considered as a pretty good conversion rate for lead generation landing pages. It means you are better than 90% of your competitors with 12%! Businesses can easily gain these numbers by crafting a highly compelling email with easy-to-understand and relevant CTA.

5. Optimize for Mobile Devices

As most of the customers are probably using mobile devices to interact with the email, it is essential to ensure that your messages are optimized for those devices as well. Some of the tips to optimize your email for mobile devices include:

  • Use a responsive template from your email service provider.
  • Pay attention to your subject line, “from” label, and pre-header text.
  • Avoid long paragraphs in your email body.
  • Use buttons for CTA instead of links.
  • Make sure the CTA directs readers to a mobile-friendly webpage.
  • Don’t embed large image files in your email.

Target Internet

Image Source: Target Internet

Not following the quick tips specified above will increase the number of unsubscribes, if in case your messages don’t render well on their small screen.

Bonus Tip:

Perform A/B test to track the performance of the email marketing campaign. You can also use the formulae mentioned in this article to measure the outcome. This method helps you monitor your mistakes as well as progress to reach the desired result.

To Sum It Up

An email has a lot more to offer when it comes to ROI. And with the tips mentioned above, you are already on the right path to reap the highest revenue. These tips undoubtedly take your business to the next level. So, without fail, understand how to utilize them in your business, and kick start your email initiatives.

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