How To Increase ROI From Email Marketing?

increase ROI with email marketing

As someone who has been in the email marketing business for years, I notice that automated email campaigns are the blind spot for many companies. Substantial email benchmarks also pay little or no attention to this.

That’s a shame, because, with relatively little effort on your part, you can double the ROI from email marketing with automated campaigns. To provide insight into this potential and the approach to automated campaigns, I benchmarked it with my own customer data. In this blog post, I will share my 4 main discoveries and how they can help you increase your revenue.

The importance of automated campaigns

Automated marketing campaigns differ from newsletters in every possible way. Not only in terms of content (mass communication versus 1-to-1 communication) but also in terms of results. Newsletters go out in large volumes (sent to many recipients) but have relatively low KPIs, such as open rates and conversion rates.

email marketing

On the other hand, automated campaigns inevitably have significantly fewer recipients but high KPIs. Examples of automated campaigns are the “welcome campaign” or the “abandoned shopping cart” campaign.

An average open rate of 20% is good for newsletters, but would only be mediocre for an automatic campaign. 

It is, therefore, essential to compare the data of newsletters and automated campaigns separately. If you do not differentiate them, the data becomes meaningless.

In my experience, our benchmark has shown that automatic campaign statistics are generally higher compared to newsletters. This actually makes sense, because the campaigns are relevant to the recipients, which increases their engagement.

Turnover from automatic campaigns

In addition to the higher open rate, these campaigns also perform better when it comes to turnover. For my clients with a full-fledged email marketing level, I see that automatic campaigns can generate much more ROI than newsletters. This is, of course, favorable, because automated campaigns require much less effort than a newsletter.

You set up an automatic campaign once and can then let it run for years unless it is no longer relevant. Of course, you can always optimize the campaigns, make them better, split test, and I definitely recommend it. However, it is not a must if you do not want to or cannot develop it further.

If you leave it alone, the automated campaign will live its own life in the background, generating revenue, and maintaining a relationship with potential clients.

Which automated campaigns to start with?

There are many automatic campaigns that you can use, and since every business has limited time and capacity, it is important to determine which campaigns you want to start with.

My experience reveals that marketers and e-commerce managers often start with the abandoned cart campaign. 

On average, 60%+ of recipients open this email, and the conversion rate of this campaign is more than three times that of the e-shop.

Still, however illogical it may sound, I advise you not to start with this campaign. Our benchmark data shows that this campaign has very few recipients—too little to bother for a start.

The campaign index

When I map how often a campaign is generally sent, this is what I would like to call “the campaign index.” 

This is a number that usually ranges from one to seven percent. It shows the number of emails sent in proportion to the number of recipients with opt-in. The higher the index, the more recipients the campaign has. This is an important (if not the most important) variable for a campaign’s sales potential.

For example: a birthday campaign for a company has a campaign index of 2%. An e-shop has 100,000 active recipients (with opt-ins) who receive the newsletter. In that case, the e-shop sends the birthday campaign to an average of 2000 recipients per month.

The benchmark results show that the campaign index of the abandoned shopping cart campaign is the lowest of all automatic campaigns, namely, 0.2%. So this campaign has very few recipients.

Due to the high campaign indices, the benchmark’s best practice is to start with the following campaigns:

  • The welcome email
  • Birthday email
  • Profile enhancement email

Don’t forget to set up so-called “reminder” emails as well. 

With reminder emails, you send a follow-up email if, for example, someone has not yet cashed in their present for their birthday.

Why are loyalty campaigns so important to brands?

In the data from our benchmark, I saw something striking, namely a big difference between the two types of businesses: brands and wholesalers. 

If you are a brand, it is very much important to focus on the customer relationship. 

By focusing on the customer relationship, I mean campaigns that encourage loyalty, such as gifts for a recipient’s birthday. 

For example, our statistics showed that sending a birthday email to someone from your mailing list, who’s birthday is approaching, has an average open rate of 45.8%. 

If we look at wholesalers and brands specifically, this open email rate for wholesalers is 31.9% and for brands no less than 63.1%!

Other examples of automated campaigns that contribute to a good customer relationship are:

  • Profile enrichment emails: ‘May we get to know you better, when is your birthday?’
  • Loyalty points: ‘With your buying volume, get a gift with your next purchase!’
  • X years of customer: ‘You made your first purchase precisely one year ago. As a thank you for your trust in us, you will receive a 10% off your next purchase!’

The importance of optimizing after set-up

Have you set up automated campaigns once? Then I advise you to monitor the data continuously in order to polish your email marketing campaign to perfection. 

This way, you always know how your campaigns are performing, and you can take immediate action if campaigns do not yield the expected results.

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Elizabeth Sramek
Elizabeth is a Senior Content Manager at Scaleo. Currently enjoying the life in Prague and sharing professional affiliate marketing tips. She's been in the online marketing business since 2006 and gladly shares all her insights and ideas on this blog.
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