Understanding Email Conversion Value: What It Is and How to Measure It
By Emil Kristensen CMO
@ Sleeknote

Email marketing is an essential tool for businesses in today’s digital age. It is a cost-effective way to build and maintain relationships with customers while promoting products and services. However, measuring the success of email campaigns can be challenging. One of the essential metrics that businesses need to track to assess the effectiveness of their email marketing is email conversion value. In this article, we will explain what email conversion value is and how to measure it.

Why Email Conversion Value Matters for Your Business

Email conversion value offers valuable insights into the returns you’re getting from your email campaigns. It enables you to determine how much revenue your emails are generating and how effectively your audience is engaging with them. Knowing your email conversion value helps you identify which campaigns are performing well and which ones need to be improved. This information is crucial for refining your email marketing strategy, increasing your revenue and improving your return on investment (ROI).

The Basics of Email Conversion Value: Definition and Formula

Email conversion value is the revenue generated from an email campaign divided by the number of emails sent. It calculates the average amount of money earned per email delivered. The formula for email conversion value is as follows:

Email Conversion Value = Total Revenue Generated from Campaign / Number of Emails Sent

For example, if a campaign generated $10,000 in revenue from 1,000 emails sent, the email conversion value would be $10:

Email Conversion Value = $10,000 / 1,000 = $10

Different Types of Email Conversion Value Metrics You Need to Know

There are different types of email conversion value metrics that businesses need to understand:

  • Overall Email Conversion Value: This is the total revenue generated from all your email marketing campaigns divided by the total number of emails sent.
  • Campaign-Specific Conversion Value: This is the revenue generated from a specific email campaign divided by the number of emails sent for that campaign.
  • Segment-Specific Conversion Value: This is the revenue generated from a specific segment of your email list divided by the number of emails sent to that segment.
  • Lifetime Value of Customer (LTV) Conversion Value: This is the revenue generated over the lifetime of a customer because of your email campaigns.

How to Calculate Your Email Conversion Value: Step-by-Step Guide

To calculate your email conversion value, follow these steps:

  1. Determine the revenue generated from your email campaign.
  2. Count the number of emails delivered.
  3. Calculate the email conversion value using the formula: Total Revenue Generated from Campaign / Number of Emails Sent

Tracking this metric over time will help you monitor changes in engagement and revenue generation from your email program.

The Role of Segmentation in Measuring Your Email Conversion Value

Segmentation is the process of breaking your email list into smaller groups based on a pre-determined criteria like location, age, purchase history, and gender. Segmenting your email list can help you to personalize your content and offers to the various different groups on your list; it also helps you measure your email conversion value more accurately. You can track email conversion value for specific segments of your email list and compare it with your overall results to identify which segments produce the most revenue. This information can help you refine your targeting efforts and increase your ROI.

Common Mistakes to Avoid When Measuring Email Conversion Value

Measuring email conversion value requires careful attention to detail. Here are five mistakes to avoid when calculating your email conversion value:

  1. Forgetting to track all the revenue generated from an email campaign.
  2. Not counting soft conversions such as profile updates or survey completions.
  3. Not accounting for the costs associated with email campaigns.
  4. Not segmenting your email list for more accurate tracking.
  5. Not tracking email conversion value over time for comparative analysis.

How to Use Email Conversion Value to Improve Your Marketing Strategy

Email conversion value can be used to optimize your email marketing strategies in several ways:

  • Identify the most profitable customer segments on your email list and target them more effectively.
  • Refine the content of your email campaigns to cater to audience-specific interests.
  • Identify email marketing strategies that generate high conversion value and prioritize those strategies for future campaigns.
  • Improve the ROI of your email marketing program by identifying effective campaigns and refining areas of low performance.

Advanced Techniques for Measuring and Analyzing Email Conversion Value

You can take your email conversion value analysis to the next level using these advanced measurement techniques:

  • Track email conversion value over time to identify trends and changes in campaign performance.
  • A/B test different email campaigns to identify which variables impact email conversion value.
  • Use email marketing automation to deliver more personalized and targeted emails, increasing email conversion value.

Case Studies: Examples of Successful Email Conversion Value Optimization

To gain insights into strategies that effectively optimize email conversion value, we will examine two case studies:

  • Case Study 1: XYZ company, a retail store, uses email segmentation to personalize special offers. By creating segments based on local store locations, XYZ sends out highly targeted and customized deals that increase customer engagement. These customized promotions led to a 20% increase in email conversion value over two years.
  • Case Study 2: ABC company, a software firm, used email automation to improve their email conversion value. By using personalized content matched to their customer’s interests, they increased email conversion value by 12% in six months. Using smart automation to analyze customer behaviors and interests, ABC was able to deliver more effective email campaigns.

Measuring your email conversion value is an essential step to optimizing the return on investment of your email marketing. The metrics can help you identify what is working well with your email campaigns, refine your marketing strategy, and improve your overall ROI. Understanding email conversion value and how to measure it effectively will take your email program to the next level.