Tim Bond, Director of Insight at the Data & Marketing Association discusses the importance of finding the right measurement metrics which reflect email marketing’s true performance, which are of use to both the marketing team and wider business.
He reveals how marketers can best communicate both the strengths and challenges to tell marketing’s story to non-marketing professionals.
Understanding the performance and success of what we do, in any capacity of life, is essential. Not just to the businesses we oversee or work for, but for our own personal growth and satisfaction too.
The marketing landscape isn’t too dissimilar in its need to be measured, but it is becoming increasingly chaotic. With a vast range of rapidly evolving channels, offering a myriad of ways to measure our performance, it makes the process of picking the measures that really matter like escaping a minefield.
Email is often highlighted by the Data & Marketing Association’s (DMA) research as the most engaging channel across most socio-demographic profiles, but it hits its peak when used in conjunction with other channels in a well-balanced marketing mix.
Finding the right measurement metrics which reflect its true performance, which are of use to the marketing team and wider business, are often difficult. But it doesn’t have to be impossible.
What are the measures that matter?
Accurately measuring marketing’s success across multiple channels is a challenge on its own. A key issue identified in the DMA’s latest Meaningful Marketing Measurement report is that marketers continue to measure the performance of campaigns, without evaluating their true value. Many marketers are measuring metrics that are most accessible, not what really matters to the business.
Understanding the deficiencies in measurement models and organising campaign measurement, as well as learnings, into coherent organisation-wide measurement frameworks is a crucial step on the path to promoting the role of marketing spend within the business.
For this to change, there must be a more unified approach adopted across the industry – including agreement on the terms we use to define effectiveness and a framework to understand the true value of marketing’s success (such as the DMA’s recently released ‘Marketing Measurement Framework 101’).
Of the 170 measures used by DMA Award entrants, 41% relate to campaign delivery measures (i.e. vanity metrics), and 59% to business, brand or response effects (which help show marketing’s true value to the wider business). This picture has remained stable between 2017-2020 and even 2021, indicating that no significant progress is being made in how the industry measures campaign impact. We must move away from vanity metrics in certain senses, especially when speaking outside of the marketing team.
However, vanity metrics can still have their place among marketers. While they tell us little about if a campaign was successful, they can be a rich source for understanding how and why a campaign did (or didn’t) go as expected.
Understanding your email campaigns’ measures
Using the example of an email campaign, let’s say its primary objective is to drive purchases. Naturally, you’re going to track revenue. However, you are not only going to track revenue, as you’ll also want to measure across other business, brand and response effects to understand the full impact of your campaign. For example, did it also drive brand awareness or sentiment/loyalty uplift? How was that revenue generated? (i.e. was it a lower number of big purchases? Or lots of smaller ones?)
These measures can all be valuable in their place. Then comes the really important bit, perhaps where ‘campaign delivery’ metrics can earn their keep. As you may need to know if the campaign failed because a fundamental deliverability issue, or where in the journey did customers drop off? (Did they open? Did they click?)
It’s understanding this that can allow you to understand the performance of your campaign. So, if it has generated massive revenues, why? If it hasn’t, then why not? That devil is in the detail and why marketers must measure a range of metrics.
I cannot overstate the importance of understanding exactly how effective your email marketing is, as well as how to make it more engaging. This is because it remains one of the most engaging and effective channels available. The ‘Meaningful Marketing Measurement: Email Focus’ report, drawing on data from over 300 email campaigns, reveals why this is so important. It found marketing campaigns that include email are more effective than the average campaign (generating 2.8 effects per campaign with and 2.7 effects without) and that email can be even more effective when part of a multi-channel approach (3.2 effects for multi-channel compared to 2.3 effects for solus email campaigns).
Telling your story to non-marketers
As marketers, it is essential to understand who, what and where we are communicating products or services to – this is no different to performance metrics! Remember, the boardroom and wider business will not understand or care as much about vanity/campaign delivery metrics, such as email opens or deliverability, as performance marketers. We must learn to speak the language of the boardroom or wider business when communicating how great our marketing is.
We also need to stop being afraid of telling bad stories, as it is often in our mistakes where we learn the most. If we can communicate that we understand what went wrong, this increases others’ confidence that we know how to put it right.
We need to be able to tell a story to non-marketers using key metrics they can understand and that truly matter to the business. Focusing on key business and response measures, with the addition of a brand effects upside too. We can then combine these insights with campaign delivery metrics to show what happened, to figure out why and then plan the next steps. We must do what we do best – tell a story.
Using benchmarks to understand performance
There are some industry benchmarks available for channels and some sectors – not least the DMA’s Email Benchmarking Report 2022. Encouragingly, all key email metrics improved year-on-year as the UK returned to some normality post-pandemic.
While industry benchmarks are useful, they must be put into context to be best utilised – not least because the distance from an arbitrary line, often without context, is not necessarily the best way to compare your own marketing’s performance.
In our email benchmark reports, we offer the ‘range’ that averages sit within, to offer some additional context to where your marketing might sit in a wider setting. In addition, we even compare between different business sectors e.g. finance and retail, as each are different and unique. But even that’s not perfect.
I always recommend coming back to yourself when looking for how and where to improve - and it’s the same for marketing. Your best benchmark is what you’ve done before – repeat it, using targeted variations, to try and observe what is most effective. Identify what you want to measure from the start, why you need it, and who would benefit from understanding this.
Fine tuning email marketing
Accurately measuring success is an ongoing challenge across all media, so ensuring marketers have the right measurement frameworks and tools to prove the value of what they do is key.
The events of the last two years have placed greater importance on the role of the email channel, and indeed all personalised customer comms. There is no use in flying blind, relying on open rates and click-through rates if they cannot be tied back to meaningful commercial outcomes for an organisation. As the original one-to-one digital channel, email has a unique opportunity to get measurement right.
