Email Marketing ROI Calculation & How to Use Email ROI Calculator?

Email Marketing ROI Calculator of Popupsmart

No matter how many innovative digital marketing tactics emerge, email marketing is still one of the most effective marketing channels due to its permission-based feature, its business utility, its customization, and targeting capabilities. Also, it is a perfect return-driven way of digital marketing: email marketing has an average return on investment of 3800%.

Before you move on the stage of implementing an email marketing campaign, initially, you need to set measurable goals and determine clear key performance indicators that will help you to track the progress of your aims.

Return on investment (ROI) in email marketing is a performance measurement metric used to evaluate the effectiveness of digital efforts and investments on email campaigns. In other words, it is the determination of what is gained from an investment and how much you have budgeted for this investment.

On the other hand, ROI for email marketing may be misguiding because if you are only focusing on maximizing overall returns, you would ignore the other benefits obtained from email marketing campaigns like satisfaction, lead nurturing, and company recognition, and micro-conversions.

email marketing roi comparison with other digital channels graphical representation

How to Calculate Email Marketing ROI

ROI (%) = (Gained Value – Spent Value) / (Spent Value)

It is essential to understand what the terms above represent;

  • Gained value is the amount of profit you earned from email marketing during an accounting period.
  • Spent value is the amount of budget you have invested in an email marketing campaign during the same period.

How to Maximize Your ROI in Email Marketing

Here are some suggestions to achieve a higher overall return on email marketing. You;

1. Grow your email list continuously to generate more leads,

2. Send triggered messages like thank you, welcome, abandoned shopping cart emails,

3. Always optimize your emails for mobile devices,

4. Focus on the deliverability of your emails sent because without reaching the targeted inboxes; you would not get any returns,

5. Make sure that you are determining and measuring key performance indicators of your business very well,

6. Can interpret all email marketing metrics correctly,

7. Look at your conversion rates to evaluate the effectiveness of email marketing campaigns, since 60% of email marketers do,

8. Interpret your email marketing returns separately: direct return (revenue, and conversion) or indirect return (the difference in subscriber activities, and company awareness),

9. Have a full understanding of the reasons behind your unreached aims for email marketing.

How to Use Email Marketing ROI Calculator

You can make the process of email marketing ROI calculation easier and faster by using the best online calculator: Popupsmart’s Email Marketing ROI Calculator.

email maketing return on investment calculator bypopupsmart

To see if you are doing email marketing right, let’s enter your values in the input fields, and interpret the results together:

Input Fields

Calculate your Email Marketing ROI: Choose your preferred currency from the list appearing when you click the arrow.

Send Volume: Enter the total number of subscribers in your email list received your email campaigns. Excluding bounced emails would provide you a more convenient conclusion.

Campaign’s Cost: Present the total cost of your email marketing campaigns. You may have more than one email marketing campaigns, but examining them separately would ease your job to evaluate different digital efforts of various campaigns generated for different business goals. To calculate the cost of a single campaign, divide the total expense by the total number of your campaigns.

Open Rate: Write the open rate of your email marketing campaign. It is the percentage of subscribers who opened the campaign email.  According to Smart Insights, the average open rate in email marketing is 24.8%, although it may vary depending on sectors and industries.

Click-Through Rate: Enter the click-through rate of your email marketing campaign. It is the percentage of subscribers who opened and clicked the call-to-action in the email. CTR is also presented in the dashboard of your ESP.

Conversion Rate: Write the conversion rate of your email marketing campaign. It is the percentage of subscribers who opened your email, clicked the call-to-action in the message, and take the desired action of your business. Conversion rate may be obtained through Google Analytics.

Average Value of a Conversion: Lastly, present the average spending per customer. Average value of a conversion is calculated by total sales in a given time and the total number of customers up to that day. It is also known as average spend per customer (ASC) or average order value in Google Analytics.

Result Fields

Cost per Contact: It shows how much you spent on a single customer in this email marketing campaign. Cost per contact is the total campaign cost divided by the total number of subscribers your email campaign sent to.

Number of Openings: It represents how many subscribers opened your email in their inboxes. Number of openings is calculated as the send volume times email open rate.

Number of Conversions: It indicates how many conversions you have obtained from the email marketing campaign. Number of conversions is the number of people who reached your website through the call-to-action in your email and took the desired action of your business like purchasing a product.

Revenue: It is the total revenue of online sales that came directly from the email marketing campaign. Revenue is estimated as total number of conversions times average value of a conversion.

Profit: It demonstrates the profit obtained from the email marketing campaign. Profit is calculated as total expenses of the campaign subtracted by total revenue.

Cost per Open Email (CPO):  It shows how much you have paid to make one customer open the email. To keep this number low, you should send emails to those who really want them.

Cost per Conversion (CPC): It indicates how much obtaining a customer making a successful conversion actually costs to you. To make this expense low, you need to offer something irresistible to ones who have landed your website through a click.

ROI: It is the percentage of return for the email marketing campaign. For instance, if your ROI is presented as 3200%, it means that you have earned $32 for every $1 spent on this campaign.

Conversions to Break Even: It tells you the significant number of conversions to obtain zero profit but no loss.

I hope your email marketing return would be much more than your expectations. As if not, popupsmart is ready to help you build an efficient email list, and start over!