Email marketing metrics 101: Conversion rate

During one of our recent webinars, more than a few people expressed surprise about how email marketing metrics are calculated, so it’s a good time to step back and review. Today we’re looking at email conversion rate.

Email conversion rate is probably both the most valuable and difficult metric to even get a hold of, much less be able to manage well. The primary reason that it’s so hard to get a hold of is that many email service providers don’t offer tracking capability for conversion or have any way to capture email’s impact on conversion.

There’s a valid reason for this: most email conversion tracking done today is last-touch attribution only, which paints a woefully incomplete picture of email marketing’s total impact on your digital marketing efforts. Email marketing can do far more than just sell things to people in unfocused blasts. As a marketing tool, it can drive and focus attention to activities which lead to conversion two, three, or more steps downstream from the actual email.

Luckily, regardless of which email service provider you use, you have access to a powerful, more inclusive conversion tracking tool: Google Analytics.

First, you’ll need to establish what a conversion is. What action or actions on your site generate value, and what is that value worth? For example, if you’re building your list, what is the value of an email subscriber to you? If you’re selling stuff, what’s the median* value of a shopping cart? Once you know what activity on your website generates value, you can assign that as a goal with a goal value in Google Analytics. More details on how to set that up are located here.

Second, you’ll want to make sure that your email service provider supports Google Analytics. If they don’t, you will have to manually tag all of the links in your email using the Google Analytics URL builder. WhatCounts customers should contact their account managers to have it enabled in their respective platforms. (both Publicaster and Professional editions have GA support built in)

Third, fire up Google Analytics after a send and scroll down to the Conversions section:

Use Visitors Overview to measure conversion rate.

You’ll find your way to the Assisted Conversions section. From here, click on the Other menu and create a new channel grouping:

Create a new channel grouping.

Inside the setup screen that follows, create a filter for Source with a RegExp that matches the following text: Publicaster|WhatCountsEmail (obviously, if you’re not a WhatCounts customer, you’ll have to substitute your own email service provider’s tracking codes in this box instead)

Measuring assisted conversion rates.

You’ve now got a custom grouping that shows you the total conversion impact of your email marketing:

Setting up a custom group in Google Analytics.

Here we can see our email marketing program’s effects on all of our digital marketing efforts. Our email marketing closed 186 conversions in its last interaction, meaning someone went straight from the email to the activity of value. We also see that email added an additional 112 conversions where the subscriber did not immediately convert but did eventually, for an extra 40% impact on our business. Ask yourself this: if you’re doing last-touch only conversion tracking, how much more impact is your email marketing program having that you’re not aware of?

There’s one more area of conversion tracking that we need to address. To interpret total conversion tracking properly, you need to add together the last touch and assisted conversions together and track them over time. One important calculation to make is the ratio of assisted to last touch conversions, as shown here over the last 8 issues of our newsletter:

A chart that measures the conversion rate of our weekly newsletter.

Tracking this ratio will let you know if your content is more action-focused (more last touch than assist) or more value-focused (more assist than last touch). Neither is better than the other as long as total conversions continues to increase. In the example above, there’s an interesting inverse relationship between last touch conversions and total conversions – the more action-focused the newsletter is, the better it converts overall. Thus, we can use this insight to alter the content of the newsletter to offer more action opportunities (while still providing value), but if we lean too much in value-focused content’s direction without providing as much action-focused content, our overall email marketing program’s performance suffers.

If you’d like help setting this sort of detailed analysis up, please feel free to contact our Strategic Service department.

Conversion tracking might seem to be the last word in email marketing metrics, but it’s not. Tomorrow, to conclude this series, we’ll look at the variety of deliverability metrics and what they mean.

Christopher S. Penn
Director of Inbound Marketing, WhatCounts

*Technical side note: for any set of statistics where you have an asymmetrical distribution, use median values rather than average values. It gives you a better picture of where the middle actually is.