Tracking the effectiveness of e-mail marketing: Bounce rate and CTR

by Lili Petkova | Jul 13, 2012

How can you reduce the bounce rate and increase the CTR to create more effective campaigns?

Tracking the effectiveness of your e-mail marketing campaign is not as difficult as it may sound, but it is really important – as with every other online activity, in fact. The general indicator for every e-mail marketing campaign is the Open Rate (link). But there are two other basic indicators that you should also definitely use in your analysis – the Bounce Rate and the Click-Through-Rate (CTR). Improving them will directly translate into more effective e-mail campaigns. But what do these indicators mean and how can you use them to make your campaign more successful?

Bounce Rate

Bounce Rate is one of the most important metrics when determining the success of an e-mail campaign. Bounce Rate shows the proportion of e-mails that were not received by your subscribers because the message was returned by the mail server or client. So basically a bounce is an e-mail that didn’t reach the subscriber and was sent back to the sender.

Bounces can be soft or hard. Hard bounces occur when the e-mail address of the subscriber is invalid or incorrect. For example, if you’re trying to send an e-mail to [email protected] instead of [email protected], the message will return to you as an undeliverable hard bounce. Soft bounces are returned to the sender as the result of a temporary issue – for example, the recipient’s inbox is full, the server is temporarily unavailable, or even because an automatic response has been set up to advise that this e-mail address doesn’t exist anymore and that you should send the e-mail to another address. Another reason that an e-mail will bounce is because of spam notification – the server flags the message as spam (correctly or not) and returns it to the sender. In most cases, hard bounces are the result of an incorrectly entered address and they are returned immediately after you send your message, so you can deal with them quickly – correct the address and send the message again. Soft bounces on the other hand can be returned between 1 minute and a couple of days after being sent.

High bounce rates have a negative impact on the sender’s reputation and delivery rate (delivery rate shows how many of the e-mails that were sent were actually delivered to customers). Focus on dealing with bounced e-mails. There are a couple of benefits when dealing with them correctly and on time. This reduces the likelihood that your messages will be defined as spam. Some e-mail services monitor the way in which the sender deals with bounces, believing that spammers won’t do anything at all about them. A problem that will occur no matter what e-mail software you’re using is that different mail servers use different notifications for the same bounce reason. Don’t give up.  Try to correct every e-mail address that is entered incorrectly, to remove invalid addresses, and to collect actual e-mail addresses from your subscribers.  A lower bounce rate means a higher delivery rate. Professional e-mail marketing software enables you to determine the reason for bounced e-mails and to automatically update your database.

But what is a normal bounce rate percentage? Well, as in many other cases when we’re talking about online indicators, it depends on your industry, on the market, and on your database. However, your first e-mail campaign with an opt-in list may get a 20% bounce rate, but this rate should go down over time, as you make your e-mail addresses more precise. If you send messages to an opt-out list based on an e-mail list that you bought online and that is of unknown quality, then you might get a 50% bounce rate. That’s why I don’t recommend using such lists, because you pay for something that you can’t use. Build your own list or use your customer’s e-mails – that’s worth it. Constantly monitor your bounce rate for every campaign and try to deal with the bounces as soon as possible. By doing this, you’ll achieve, over time, a pretty clean list of e-mails and a really low bounce rate.

CTR

Click-through-rate is considered one of the most important indicators in any online campaign and e-mail campaigns are no exception. The CTR in e-mail marketing is the number of receivers who click through the links in your e-mail compared to the total number of recipients. It’s really important to know if your CTR is measured by unique clicks or not. Knowing this will help you to improve the performance of your messages. If you have several links in your e-mail, you should have a way to compare them in order to see which one was more effective and why – and after that, try to implement the more successful practises in your next campaign. There are many factors that determine your CTR – the e-mails that you use of course, the design, the copy, etc. But particularly important are the actual links – their location, their visibility, are that they actually work. Some advice: always test every link before sending your message – and test them twice! If they’re not working, you’re wasting your efforts.

You should calculate CTR on open e-mails, not on delivered ones. This will give you a more accurate CTR. Combine CTR with Open Rate so that you can properly compare different e-mail campaigns. For example: if you send a message to 1,000 recipients and get a 5% CTR for one campaign and then send a message to 1,000 recipients and get a 6% CTR for another campaign, you’ll think that the second one is more effective. But let’s include the Open Rate in the analysis. If in the first case 500 people opened the e-mail, you’ve generated 25 clicks. If in the second case 300 people opened the e-mail, your message generated 18 clicks. So think again – which campaign was more successful?

Here comes “The question” – what CTR is a good CTR? CTR differs depending on if we’re talking about business mailing or consumer mailing.  It depends on the use of personalisation for the e-mails, how well the database is targeted, how often you send messages, and many other factors…but most importantly – on the number of links in your message. A CTR that is based on total clicks (because in some e-mails we have 4 or 5 links) is higher than a CTR calculated by unique clicks. But back to the point – what is a good CTR? Here are some ranges for average CTRs for different e-mail campaigns.  The CTR is calculated as unique clicks divided by e-mails delivered.

• B2C e-mail campaigns with promotion included – from 2 to 12% depending on how well the recipients are targeted.
• B2B newsletters vary from 5 to 15%. If you get CTRs below 5%, maybe your content is not interesting to your subscribers.
• Precisely targeted e-mails reach 10 to 20% CTR. If they are not well targeted, but have a strong message, they get 10 to 15%.
• The highest click-through-rates are for campaigns that are targeted based on the behaviour of customers – they receive the e-mail because they did something specific. Their CTRs are from 20 to 50%.

CTR below 2% is considered poor and you should make some changes in your campaign.

How to achieve a higher CTR?

• Improve your subject, design and copy. Write shorter copy and make your recipients want to read more on your web page. Just make your e-mails more effective!
• Improve your Delivery Rate, Open Rate and Bounce Rate. If a lot of your messages are blocked and don’t reach the recipient, you won’t get many clicks. And if only a few people open your e-mails and read them, you can’t have a good CTR.
• Target your e-mails. Targeted e-mails are more effective, not only in terms of the CTR, but in terms of conversions and sales leads, and of course revenue. You can provide a more targeted offer that is interesting to the recipient group and that increases the likelihood of clicking and buying.
• Include a “P.S.” This is a great way to attract the attention of busy customers with little time – they usually go through an e-mail for a couple of seconds and if something doesn’t grab their attention, you’ve lost them. The P.S. always attracts the eye and customers tend to be curious to read more so they often will click on the link in the P.S. So take your time and create a short grabbing P.S. and try its effectiveness – you’ll be surprised.
• Be social! Social sharing options increase CTR – even if a recipient doesn’t want your offer, maybe they know someone who might be interested in it. Social sharing will definitely increase your CTR, and because of it, your revenue. Your message goes directly to people interested in your offer, so be social!
• Give people a reason to click. Include a deadline to your offer, a limited discount or a special offer only for the recipients of the e-mail. In other words, create a proper call-to-action that is  impossible to be missed by the user.

In theory a high CTR will lead to more positive results and an increase in revenue. But if your landing page is not good enough and can’t convert enough users into leads, the high CTR won’t lead to an increase in sales. So, track not only the CTR but also the conversion rate, so that you can see if you need to improve your landing page. The conversion rate is usually low compared to the CTR, but anything more than 10% is great.

In conclusion, keep in mind that every indicator of your e-mail marketing campaign needs to be considered in order to help you to improve your messages and achieve better results. Take your time when analysing the results from your campaigns and put in the effort to improve them – they’ll come back to you!