They say those who fail to learn from history are doomed to repeat it. But not all history is created equal and not every view of history is the same. But how does this relate to understanding success in email marketing?
There is a long list of reasons why it’s very smart for businesses to invest in email marketing for their products and services. But what’s most imperative for any marketing effort is an understanding of exactly what defines success. If you don’t define success at the beginning, you’ll never understand if the budget and resources you spent were worth the effort.
In email marketing’s earliest days, the success of an email campaign was measured in single digits. An average-performing email returned a 2 to 2.5 percent click through rate (CTR). Because of their periodical nature, email newsletters to a regular list returned at a higher 8-10 percent rate, but generally, 2.5 percent was expected and 3 percent or higher was success.
Now if you have a list of 4MM names, not unusual in the early 2000’s for a company the size of Nokia, for example, that’s about 100,000 click throughs and a good number of prospective customers by any measure. But if your list was smaller…
The point is email success was, and continues to be, measured in very small margins. And as another old expression goes — the more things change, the more they stay the same.
What does success look like today?
At first glance, the numbers are up, but do they look very different?
Average open rates across all industries ranged from 13-20 percent or so in 2005. In 2015, open rates are almost all above 20 percent, according to a recent study by Mailchimp, but average CTR is is only about 3.5 percent, according to Mailgen. This is up just a small amount compared to a decade ago.
Why? Part of the reason is that we receive substantially more email than we did at that time and it takes more to break through. But that’s only part of the story.
Clearly, CTR varies by industry and business size with some industries — healthcare, consumer services, education and nonprofit — realizing a CTR over 4 percent, according to a study by Silverpop.
A variety of studies show what seems like a counter-intuitive trend that smaller companies tend to have lower open rates, but higher CTR and larger companies tend to see the reverse. Why? We think it’s simply that the smaller companies have a more highly targeted and engaged list for their products and services. This is a view of email that we didn’t have a decade ago.
We should note that the rates we reference here tend to apply to B2C efforts. B2B efforts tend to have higher performance rates and follow slightly different rules simply because, if you’re maintaining a clean opt-in list, the targets are inherently qualified and as a result, more naturally interested in responding to your message.
Why are some numbers so similar and others so different?
Part of the change comes from our ability to capture better data, but we can’t lay all of the change at that doorstep. A larger part of the equation has developed with the technology and mobile preferences of our target audience.
We’re simply working from a different baseline. In the early days, almost all email was read on desktop devices. The typical email experience followed a pattern like:
- Open your email client
- Read the subject line
- Make a decision – open, ignore, delete
- Once open, make a decision – read, click-through, delete, unsubscribe
That’s it. So the information you knew about an email subscriber was they received your email, they were interested enough to open it – or not. Then they were interested enough to read it and click through – or not. Or they just deleted or unsubscribed somewhere along the path.
Today, readers engage with email in a very different way. For instance, 65 percent of them regularly open their email first on mobile devices – smartphones or tablets. And where open rate was once a valuable stat, the information a user sees in the palm of their hand often allows them to make a condensed decision. They see from line. They see subject line. And they see a preview pane clueing them in on what the email is about. They’re able to make a decision — or not — at an earlier point in the experience.
Compared to those who open their email on desktops and laptops, mobile readers are far less likely to click through on mobile devices. That said, 23 percent of those who first engaged on mobile, opened the email a second time and clicked through on a different device, according to Marketing Profs.
The ability to understand the basic numbers – open rate, CTR – and how the reader’s experience at different points along the path impact those numbers is integral to success. Sure the basic numbers haven’t moved much over time, but the understanding of what they mean and the opportunities they present make a huge difference.
Benchmarking numbers is important, no doubt, but applying best practices in a consistent and intelligent way to optimize the message and the creative you’re sending to improve send-over-send performance is tremendously valuable. Taking this kind of approach will push a lift in open and CTR month after month. Email marketing and maintenance of a strong list is indeed a marathon effort, not a sprint.