Whether you are using loosely defined KPIs or established ones -- or not using KPIs at all -- reviewing the data and metrics that drive your email success is a great exercise. Establishing metrics that you can use to evaluate your programs is important not only in measuring the health of your email programs, but also in demonstrating to your C-suite email marketing’s valuable contribution to the bottom line. Many organizations stop short with the definition of a single set of metrics. However, in order to effectively convey the value of their program, marketers need to approach measurement from multiple directions.
Many brands start and stop the KPI definition with email effectiveness. Looking at metrics such as open, click, conversion, unsubscribes and spam complaints are pretty common. These are, after all, very measurable. However, merely tracking these numbers per campaign or per month are really not enough to give you meaningful insights into your program. Yes, tracking these types of metrics can demonstrate how a single communication performed at a moment in time with a specific audience, but they don’t provide enough data to reveal a trend, especially if your business cycles with heavy seasonality.
The first step in KPI definition is really defining what it is you are trying to influence or accomplish with your email program. For many, it is the simple statement “drive revenue.” But that isn’t the case for everyone. For some, it is to drive account log-ins and page visits, or increase time spent on a site or the number of downloads. Successfully defining your email effectiveness starts with defining all the objectives of your program.
Once you’ve done that, then it’s time to start thinking like your boss’s boss. I haven’t met a CMO yet who cares a lot about the unsubscribe rate of an email program. Many don’t even want to hear about the opens and click rates. It’s imperative that you translate your KPIs into metrics, data points and sound bites that CMOs can sink their teeth into.
Next, start looking at the definition of leading indicators and metrics that get you to your defined goals and at the same time give your C-Suite the view of the email channel that solidifies its contribution to the marketing mix. For example, what contribution is the email channel making to the bottom line? What is the incremental LTV of customers who subscribe to your email program versus those who don’t?
In the end, you should determine the KPIs that are the most meaningful to your business. Thought leaders, third parties and strategy experts can certainly help you fine-tune the specifics -- but as a brand, you own the vision.
Exactly: ESPs collect technical data, not financial data, which is a real problem if you need to demonstrate a the business case. You can't act on data that you don't have. Integrating with a real-time marketing system is very simple and plugs this gap - you immediately get real-time financial reports for your email marketing:
Enterprise culture and communication is important. There are industry standard and business function specific business intelligence tools with KPI modules, but we at ElegantJ BI find that these solutions still have to be tailored to the individual organization, targets, and minimums and maximums to be defined and then gradually moved to the teams for adoption. Sometimes the other systems that will provide targets or the base data to build targets aren’t ready or they don’t provide accurate data, and sometimes, it takes a few iterations to get to what you need. So, as you have said in this article, the business must be committed to building a performance driven culture, and to streamlining and improving communication, and, in all likelihood, the process of getting to the desired state will be an iterative process. It may seem like the enterprise is taking the long way around, but the business team must focus on building for long-term, solid results and a culture that supports clear, concise, objective decision making and full commitment to business success at every level.