One of the most popular questions we’re asked in the email marketing world are about industry averages for standard email metrics:
- “What’s a good open rate for my industry?”
- “What’s a good click through rate industry average?”
- “What’s a good or bad opt out rate for B2C companies?”
These questions are worthless, not because they are devoid of meaning, but because the data used to answer the questions is worthless. Why? There is no average audience. Every company, every industry, every marketer will have their own averages, and within industries, there are incredibly wide variations.
For example, suppose your company was in financial services. Compare these three financial services companies:
- Smallville Credit Union
- Golden Slacks Hedge Fund
- Buy Your House Mortgage Services
All are in “financial services”. All have very different audiences, including audiences that have different customer intents and behaviors. People looking to do business with Buy Your House Mortgage Services have very different expectations about how their financial institution deals with them than Smallville Credit Union or the Hedge Fund. The customers who do business with a Hedge Fund are likely to have entirely different behaviors in email than those belonging to the mortgage service company.
Now let’s say you look at the average open rates of each of the three examples:
- Smallville Credit Union: 47% open
- Golden Slacks Hedge Fund: 11% open
- Buy Your House Mortgage Services: 0.05% open
These numbers show the severe differences in the behaviors of the three audiences. The small, local credit union that has a personal relationship with its customers will get vastly different performance out of email marketing than the mortgage services company sending hundreds of millions of emails in the hopes that someone needs a mortgage.
Now suppose you average these together and make the bold pronouncement that the average open rate in financial services is 19.35%. You have a number which is unhelpful to each of the members of that index and doesn’t do much to help any of the companies involved in its creation. The credit union is likely to think there’s no need to invest any more or expend any additional resources to improve its email program, while the mortgage services company is probably firing its digital marketing agency every 6 months because no one can approach the mythical 19.35% open rate for an audience that isn’t theirs.
So what does matter, if industry averages don’t? Your individual company performance. As long as your open rate, clickthrough rate, and conversion rates are never 100%, you have room for improvement. Carefully track the individual metrics that matter to you and then seek to improve them with every send. If you feel the need to compete against numbers, compete against your own numbers, because in doing so, you’ll constantly be working to improve your business, regardless of your industry. At the end of the day, isn’t constant and never-ending improvement what counts?
Christopher S. Penn
Director of Strategy, WhatCounts