Email Marketing ROI Calculator
Calculate the Return on Investment for your email campaigns instantly.
Understanding Email Marketing ROI
Email marketing remains one of the most cost-effective digital marketing channels available today. ROI, or Return on Investment, measures the efficiency of your email spend by comparing the net profit generated against the costs incurred (software subscriptions, design, copywriting, and list acquisition).
How the ROI Formula Works
To calculate your return, we look at the entire funnel from delivery to dollars:
- Total Clicks: Calculated as Emails Sent × Open Rate × Click Rate.
- Total Conversions: Calculated as Total Clicks × Conversion Rate.
- Gross Revenue: Calculated as Total Conversions × Average Order Value.
- ROI Formula:
((Revenue - Cost) / Cost) * 100
Example Calculation
Imagine you spend $200 on a single campaign to reach 5,000 subscribers. If your open rate is 20% and your click-through rate is 3%, you get 30 clicks. With a 10% conversion rate on your landing page, you secure 3 sales. If your average order value is $150, your revenue is $450. Your net profit is $250, resulting in a 125% ROI.
Tips to Improve Your Email ROI
1. A/B Test Subject Lines: Improving your open rate by just 2% can significantly increase the number of potential buyers entering your funnel.
2. Segmentation: Sending targeted offers to specific user groups typically results in higher conversion rates than "blast" emails.
3. Optimize Landing Pages: ROI isn't just about the email; ensure the page users land on is designed to convert visitors into customers.