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Email Marketing Roi Calculation: Top Things To Know in 2025

Posted: by Charisse Flores



Did you know email marketing can bring in an ROI of up to 4400%? That means you get $44 back for every $1 you spend on your email campaign. As a professional copywriting journalist, I’m excited to explore email marketing ROI with you. I’ll share tips on how to figure out your investment’s return.

Return on investment (ROI) is key for any marketing plan, including email campaigns. It shows how much profit you make from an investment. To calculate ROI, use this formula: (Gained – Spent) / Spent = ROI, expressed as a percentage. But, figuring out email marketing ROI can be tricky. Email can help with many goals, like making your brand known, getting more website visitors, and boosting sales.

email campaign ROI

Key Takeaways

  • Email marketing can produce an ROI as high as 4400%.
  • ROI is a crucial metric for evaluating the success of email campaigns.
  • Calculating email campaign ROI requires understanding the specific goals of the campaign.
  • The basic ROI formula is: (Gained – Spent) / Spent = ROI (percentage).
  • Tracking email marketing ROI can be challenging due to the diverse goals of email campaigns.

What is Email Marketing ROI?

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The main objective of implementing customer retention emails is ROI growth.

Understanding return on investment (ROI) is key to checking how well your email marketing works. ROI measures how well your marketing efforts do their job. By looking at email marketing ROI, you can see how your campaigns are doing. This helps you make smart choices to improve your strategy.

Understanding the Concept of Return on Investment (ROI)

The formula for ROI is simple: (Gained – Spent) / Spent = ROI, as a percentage. In email marketing, “gained” is the revenue or benefits from your campaigns. “Spent” is the cost of running those campaigns. Or you can use a tool like this Campaigner review to compute your ROI easily.

The Importance of Tracking Email Marketing ROI

It’s vital to track your email marketing ROI to see if it’s worth it. Marketers need to easily calculate ROI to see the real effect of their efforts. Knowing what your email marketing aims to do, like increasing sales or boosting website traffic, helps you figure out the ROI.

Calculating Email Marketing Expenses

To get a clear view of your email marketing ROI, you must look at all costs. The main cost is the email service provider (ESP) fee. But, you also need to think about your team’s time and effort.

Email Service Provider (ESP) Costs

Calculating your ESP cost is simple. Most providers charge based on your email list size or how many emails you send. Remember to add any extra features or upgrades to your subscription fees.

Team Bandwidth and Salaries

Figuring out your team’s email marketing cost can be tricky. Team members might work on emails and other marketing tasks. Track the time they spend on email tasks and multiply it by their hourly rate to get a better idea of the cost.

Additional Marketing Tools and Services

what a/b testing looks like
The process of A/B testing. Source: Toward Data Science

You might use other tools or services for your email marketing, like design software, A/B testing platforms, or data analysis tools. Make sure to include these costs in your total email marketing expenses. You can invest in a tool like Maropost Marketing Cloud. Check out this Maropost Marketing Cloud review to learn more.

By looking at all these costs, you’ll understand your email marketing expenses fully. This is key to knowing the true ROI of your campaigns.

Calculating Email Marketing Revenue

Figuring out how much money your email marketing makes is key to knowing its value. By tracking sales and understanding the worth of leads and conversions, you can see how your email campaigns really help your business.

Tracking Sales from Email Campaigns

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When learned and done appropriately, email marketing tools can drive great sales and ROI.

If your business sells things online, tracking email campaign sales is easy. Many email services work with Google Analytics. This lets you see every sale linked to an email campaign. This info shows you exactly how much money your email marketing makes.

Valuing Leads and Conversions

Not all emails aim to make a sale right away. Some help get leads or get people to do other actions, like visit a website or download content. To figure out the value of these actions, use Google Analytics to count them. Then, assign a dollar value to each one based on your business goals and past data.

Adding up direct sales and the value of leads and conversions gives you a full view of your email marketing’s earnings. This info is key for figuring out your email marketing ROI. It helps you make smart choices about your marketing plans.

The Email Campaign ROI Formula

To figure out the return on investment (ROI) for your email marketing, gather all the pieces we’ve talked about. The email campaign ROI formula is a simple yet powerful tool. It helps measure how successful your email marketing is.

Let’s look at an example to see how to calculate email campaign ROI. A business spends $200 a month on their email service, which is $2,400 a year. They also have a marketer working 2 hours a day, 5 days a week, for $16 an hour. This adds up to $7,680 a year. So, their total email marketing spend is $10,080 a year.

This business gets 300 leads a year, each worth $100. So, the total revenue is $30,000. Using the email campaign ROI formula, we get:

ROI CalculationValue
Gain (Revenue)$30,000
Spent (Expenses)$10,080
ROI = (Gain – Spent) / Spent($30,000 – $10,080) / $10,080 = 197.6%

The email campaign ROI is an impressive 197.6%. This means for every dollar spent, the business made $1.976. Tracking and analyzing your email campaign ROI helps you make better marketing decisions. It drives even better results.

Attribution Models for Email Marketing ROI

sender reputation

Finding out how much your email marketing makes back is tricky. It involves tracking customers from start to finish. To get a clear picture, we look at different attribution models. These help spread out the credit and see how each step leads to a sale.

Last-Click Attribution

The last-click model is simple. It says the last email before a sale gets all the credit. But, it misses the early emails that helped the customer decide.

First-Click Attribution

On the other side, the first-click model gives all credit to the first email that caught the customer’s eye. It’s good for finding the best ways to get leads. But, it doesn’t see how later emails helped too.

Linear Attribution

The linear model spreads the credit evenly across all emails. It values each step the same. But, it might not show how much each email really helped in the end.

Knowing about these models helps you see what your email marketing is really worth. By picking the right model, you can make better choices for your marketing.

Factors Influencing Email Campaign ROI

Getting a good return on investment (ROI) from your email marketing takes more than just great content. Two key things can greatly affect your email campaign ROI. These are your tracking systems and data quality, and how you segment and personalize your emails.

Tracking Systems and Data Quality

Having accurate data tracking is key to knowing how well your email marketing works. A good tracking system helps you see which marketing efforts, like your emails, lead to sales. This is vital for figuring out your email marketing ROI, especially with complex models.

Segmentation and Personalization

SMS segmentation
Segmentation improves personalization.

Email marketing doesn’t work the same for everyone. By segmenting your audience and making emails more personal, you can increase engagement and open rates. This leads to a better email marketing ROI. Different groups of customers might need different ways to measure the success of your emails. Focusing on segmentation and personalization can really help your efforts.

Conclusion

This article has shown how to boost your email marketing ROI. It talked about the importance of ROI, tracking costs and earnings, and using different models to see how email marketing works. It also looked at what affects email campaign ROI, like tracking systems and data quality, and how to make campaigns more personal.

By using the tips from this article, businesses can better understand their email campaigns’ impact. This helps them make smart choices, improve their efforts, and get better results. Email marketing can be a key part of a business’s marketing strategy.

Email marketing is still a great way to reach and connect with customers affordably. With the knowledge and methods shared here, businesses can make the most of email marketing. This ensures their efforts in this area bring good, lasting results.

FAQ

  • What is email marketing ROI?
    Email marketing ROI measures how profitable an email campaign is. It’s found by subtracting the campaign’s cost from its revenue. Then, divide the result by the campaign’s cost.
  • Why is it important to track email marketing ROI?
    Tracking email marketing ROI is key. It shows how well email campaigns work and make money. It helps marketers see which campaigns do well and which need work or should stop.
  • What are the key components to consider when calculating email marketing expenses?
    When figuring out email marketing costs, think about the email service provider’s fees. Also, consider the time your team spends on it and any extra tools or services needed.
  • How can I calculate the revenue generated from email marketing?
    To find out how much revenue email marketing brings in, track conversions. This includes website visits, sales, and other important actions. Then, multiply these by the value of each conversion.
  • What is the formula for calculating email marketing ROI?
    To calculate email marketing ROI, use this formula: (Gain – Spent) / Spent = ROI. This shows the campaign’s profit by subtracting costs from revenue, then dividing by costs.
  • What are the different attribution models for email marketing ROI?
    There are several attribution models for email marketing ROI. These include last-click, first-click, linear, time-decay, and custom models. Each has its own strengths and weaknesses. The best one depends on your business’s needs and marketing plan.
  • How do tracking systems and data quality impact email campaign ROI?
    Good data tracking and a solid data system are vital for linking conversions to email marketing. This is key for figuring out email marketing ROI. Segmenting and personalizing your emails also boosts ROI.

Be inspired by several examples of successful email marketing campaigns in this “Email Marketing Case Studies: Proven Success in 2024” article.

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