Sign up

How to calculate email marketing ROI to improve email marketing success rate?

How to calculate email marketing ROI to improve email marketing success rate?

Email marketing, over many decades, has proven itself to be one of the most reliable forms of online marketing. It has remained as one of the most elite channels for the communication of business processing.

 Being a cost-effective digital marketing solution companies globally have continued to invest in it considerably to maximise their ROI or Return On Investment. Email marketing ROI is the key factor which determines the execution, continuity and abortion of a marketing campaign by a business.

What is email marketing ROI?

ROI is the process which provides marketers with critical insights on overall performance and profit gained from their marketing strategies. If the performance of your campaign is not good, it can mean limitation in strategising and planning, lack of competitor analysis and the need for much brainstorming from your marketeers. In simple words, email marketing return on investment is the (gain-spent)/spent (denoted in percentage)

ROI = (gain – spent)/spent

How to calculate ROI?

The first step in calculating your ROI is by calculating the spend. It can be a complicated process because it does not end at just figuring how much money you spend on your ESP. You should also include how much time you or your teammates spend on email marketing. You should convert it into hourly rates and calculate an estimate. Your total expenditure, therefore, would be ESP and its costs + Bandwidth of your team.

In the second step, you need to calculate how much money your email campaigns bring in. This is comparatively much easier. If the ESP you are using has Google Analytics integrated, you can easily track each sale made from your emails from specific campaigns or in general over a certain period. You must calculate the value of a lead by tracing each conversion made through your email campaign on Google Analytics. You must also include website traffic. After that multiply the value of a lead with the number of conversions. This will give you the total amount of revenue generated from an email campaign.

Gain = Value of a Lead X Number of Conversions

Let us look at an example.

Let us assume that you pay $100/month for your ESP. In a year, it sums up to $1,200. Now you have a marketer working directly on email campaigns for 2 hours for 5 days a week and at a rate of $20/hour.  That amounts to $10,800 as your email marketing spending.

Now, let us assume that the cost of a lead is $100 and that email campaigns bring you 400 leads a year. So, your revenue from email is $40,000.

Therefore, your return on marketing investment calculation comes down to –

$(40,000-10,800) / $10,800 = 270.37 %

What is a good email marketing ROI?

It is a universal truth that emails offer the highest returns for the amount of money invested. It is also the most measurable form of returns for marketers. The return on emails sent might vary depending on the industry and email type. However, keeping up to date with the latest trends and strategies, referring to and understanding email marketing ROI statistics and finally implementing them would ensure a high and standard return.

A good email marketing ROI rate can average between 3600% to 4200%. It means that for every $1 invested you will receive a return of an average of $36 to $42.

How to increase your email marketing success rate?

Email marketers have tried and tested many methods and strategies over the years to achieve favourable success rates. Some have succeeded, others not so much. However, almost all good marketers have kept the following techniques in the core of their strategies.


The most crucial factor behind the success of email campaigns is the relationship with your audience. The shortcut to improve this relationship is personalisation. One of the easiest tricks by which you can bring your customers to engage with the campaigns is by referring them with their first names.

You can utilise suitable forms of your data for sending offers to target each individual uniquely. You can begin the process by segmenting your list as transparently as possible. You can then use the highlighted characteristics of those segments to create a customer experience that feels one-on-one. Personalised emails can generate six times more transaction rates than regular chain emails.

Boosting customer networks

To succeed in email marketing campaigns, you need to boost your customer networks. You can attach online forms to your preferred email marketing platform to send data, like phone numbers and emails instantly into your email list without having to type in a single detail. You can sue the time saved to work on plans how you would engage your customers. You can also utilise web forms to collect new subscribers with inserting forms and social sharing. You can add such forms on your blogs, social media sites, and other landing pages to bolster email sign-ups. It will help you to gain new subscribers from any consumer touch-point with your brand.

Using exclusive content

Creating and inserting subscription forms is an essential factor, but you have to offer some incentives to your potential subscribers for actually filling-up those forms. The best way to accomplish this is by generating interest among customers with useful and exclusive content.

You can tempt your customers to read the content by providing an attractive subject line. You can also inform them about the offer through your blog posts, Google hangouts, articles, and info-graphics that offer a valuable service to your subscribers, such as helping them to search for new products and technology, while industry trends will help you prove that your content is worth a subscription.

Mobile optimisation

At present mobile optimisation has a specific vital role in the enhancement of ROI. You should change your email as a one-column template for a simple mobile fix. Your acquisition forms should always be compatible with mobile devices. If customers having smartphones can’t fill out your form, you are sure to lose them.

So it would help if you chose an online form builder optimised for tablets and cellphones, which can be accessed by the new customers. Mobile optimisation helps to increase your contact network with new customers. Try to offer as smooth a mobile experience you can and present your subscribers with content that they can access on mobile phones without any trouble.

Conducting experiments

With the support of variant tools, you can measure the effectiveness of your marketing campaigns, and also bring forth significant improvements in ROI. Besides, to stay ahead in the competition, invariant optimisation is required for business sites to meet up to date market challenges.

You can also update content, alter CTA, navigate tests, and other elements in your experimental procedures. However, remember not to bring out these changes on live sites. Instead, create a separate version of the page and conduct A/B tests or multi-variant tests to optimise it. Make it live only after monitoring the results.

Conclusion: Email marketing ROI statistics

I would like to wrap up by highlighting the top statistics in 2020 from the email marketing industry.

  •  In 2019, almost 294 billion emails were exchanged. This number is expected to reach nearly 350 billion by the year 2020. The number of active email users is expected to cross the halfway mark of the human population and hover around 4.3 billion by 2023.
  • The average ROI for every $1 spent on email marketing was 42$. It is a whopping profit margin of more than 4000%, naturally making it very popular among 90 per cent of email marketers to distribute content organically.
  • Small businesses, almost 81%, use email marketing to acquire customers, and 80% of them use it for retention.
  • As far as open rates are concerned, welcome emails have seen an open rate of 82% and emails with personalised subject lines have seen open rates increase by 50%.
  • Nearly half of all consumers have responded that they are eager to receive promotional emails from their favourite brands and, whenever these promotional emails consisted of interactive content or videos, click rates increased by 300%.

A broad idea about the numbers in the industry is bound to reassure you and your business of steady increments in ROI over the next few years. For those who are still doubtful, it is the perfect moment to dive into email marketing and start using it to expand your reach to new corners.  



I am a freelance content strategist with 3 years of experience creating and managing diverse marketing content for SaaS companies. I offer brands precise, informative, and high-quality writing and strategizing services

Related Articles