Email marketing remains one of the most effective digital marketing strategies, offering an impressive return on investment (ROI) when done correctly. But how do you know if your email marketing efforts are truly paying off?
We’ll break down how to calculate your email marketing ROI step by step, explore what success looks like in this channel, and offer actionable strategies to improve your performance. We’ll also highlight how a platform like DailyStory can simplify and supercharge your email marketing.
What is email marketing ROI?
Email marketing ROI refers to the revenue you generate from your email campaigns relative to how much you spend to run them. It’s a critical metric for marketers looking to justify budget spend and optimize future campaigns.
The higher your ROI, the more effective your campaigns are in generating profits.
How to calculate your email marketing ROI
Calculating ROI for email marketing involves comparing the revenue generated from your campaigns against your total investment. Here’s a step-by-step breakdown:
Step 1: Track your revenue
Identify how much revenue was directly generated from a specific email campaign. Use tools like Google Analytics with UTM parameters or an integrated platform like DailyStory to track purchases and conversions back to your email campaigns.
Example:
Revenue from campaign: $5,000
Step 2: Determine your costs
This includes any tools, software, labor, and other resources required to run your email campaigns.
Email platform subscription (e.g., DailyStory)
Graphic design or copywriting costs
Paid list rentals or data cleaning services
Staff time
Example:
Total cost: $1,000
Step 3: Use the ROI formula
Now plug your numbers into the ROI formula:
ROI = (Revenue – Cost) / Cost x 100
Example:
ROI = ($5,000 – $1,000) / $1,000 x 100 = 400%
This means you earn $4 for every $1 spent.
What is the success rate of email marketing?
Understanding industry benchmarks helps gauge whether your campaigns are performing well. Here are average rates you can expect:
Open rate: 20% – 25%
Click-through rate (CTR): 2% – 5%
Conversion rate: 1% – 3%
These numbers vary by industry, list quality, and email content. A lower-than-average rate could indicate issues with subject lines, audience targeting, or call-to-action clarity.
Strategies to improve your metrics
1. Segment your audience
Sending personalized content to targeted segments improves engagement. Use behavioral data, past purchases, or demographic filters to refine your list.
2. Optimize subject lines
First impressions matter. A subject line that sparks curiosity or offers value can increase open rates.
3. Use strong CTAs
Make your call-to-action stand out with clear language, buttons, and urgency (e.g., “Claim your discount now!”).
4. A/B test your emails
Experiment with different layouts, images, or messaging. Platforms like DailyStory make A/B testing simple and insightful.
5. Mobile optimization
Over 50 percent of emails are opened on mobile. Ensure your design is responsive and easy to read on any device.
Why choose DailyStory for better email marketing ROI?
DailyStory is a marketing automation platform built to help businesses maximize their email marketing ROI. Here’s how it helps:
Advanced tracking and analytics: Easily attribute revenue to specific email campaigns.
Segmentation and personalization: Deliver targeted messages that convert.
Built-in A/B testing: Optimize every element of your email.
Seamless integrations: Connect with CRM tools, eCommerce platforms, and more.
Time-saving automation: Trigger campaigns based on behavior, time, or actions.
By using DailyStory, businesses not only gain insights into their ROI but also have the tools to consistently improve it.
Conclusion
Knowing how to calculate your email marketing ROI is essential to understanding the true value of your campaigns. By tracking the right metrics and continually optimizing performance, you can turn email into one of your most profitable marketing channels.
Tools like DailyStory make it easier than ever to achieve high returns with minimal guesswork.
