Email Marketing ROI Calculator
Determine the profitability of your email campaigns instantly.
Estimated Clicks:
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Estimated Conversions:
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Gross Revenue:
$0.00
Net Profit:
$0.00
Return on Investment:
0%
How to Calculate Email Marketing ROI
Return on Investment (ROI) is the most critical metric for any digital marketer. In email marketing, ROI measures the efficiency of your spend relative to the revenue generated by your subscribers. Unlike social media likes or impressions, ROI provides a direct look at your bottom line.
The Formula:
ROI = ((Revenue - Cost) / Cost) x 100
To use this calculator effectively, you need five key data points:
- Campaign Cost: This includes software fees (ESP), copywriter costs, and design expenses.
- Emails Sent: The total size of your recipient list for a specific blast.
- CTR (%): The percentage of people who clicked a link within your email.
- Conversion Rate: The percentage of people who clicked and then completed a purchase.
- Average Order Value: The average dollar amount spent by a customer during a transaction.
Example Calculation
Imagine you send a promotional email to 50,000 subscribers. Your campaign costs $1,000. If your CTR is 2% (1,000 clicks) and your conversion rate is 5% (50 sales), with an average order value of $100, your gross revenue is $5,000.
Using the formula: (($5,000 - $1,000) / $1,000) * 100 = 400% ROI. This means for every $1 spent, you earned $4 in profit.
Tips to Improve Your Email ROI
If your ROI is lower than expected, focus on these three levers:
- Segmentation: Send targeted messages to specific groups rather than "blasting" your whole list. High relevance leads to higher CTR.
- A/B Testing: Experiment with subject lines to increase open rates and call-to-action (CTA) buttons to increase click rates.
- Landing Page Optimization: If people are clicking but not buying, the friction is likely on your website. Ensure your landing page matches the email's promise.