Importance of ROI in email marketing.

Published in december, 02 of 2013

The success of any eCommerce depends on selling products and keeping customers happy so that they always come back to make new purchases. But every transaction should be monitored and its price set up according to many metrics. Even though it may sound unbelievable, many professionals simply do not understand the ROI and how to calculate it. If you run an online business, first of all you should be interested in its return. How much in general you spend on your company in comparison with how much you get back?  

Are you sure you know the correct answer to this question? If so, you do not have to read more. If not, you better read and understand how important it is to be able to calculate Return on Investments of your business. 

Irrelevant e-mail marketing campaigns, poor timing, lack of understanding ROI can lead marketers to conviction that email marketing does not bring satisfactory results. However, well performed campaigns with targeted contacts and relevant to their interest content are able to succeed and bring expected Return On Investment.  

Let's start from the beginning. What is ROI and what do I need it for?

ROI is a ratio used by marketers to calculate the company's performance and the mathematical formula is: 

Gained-Spent/Spent = Return on Investment expressed as a percentage 

You can use an online tool like: Google Analytics that can help calculate the ROI of your business and understand your market performance. By using this tool , you will also be able to better optimize your online campaigns and trigger more conversions or leads. At the end of the day you have to know how your eCommerce performs on the market to make possible changes and increase its profitability. Indeed it happens that marketers perform successful e-mail campaigns without even knowing their ROI and many other metrics, but it may be a matter of luck rather than deliberate planning.  

Therefore, we recommend you always analyze the ROI of your email marketing campaigns and compare the results with other marketing channels like AdWords campaigns, organic search, etc. You can also compare your current campaigns to these ones you already carried out in the past. This way you will have an overview of what works well for your product/service and what you have to improve. 

By analyzing a campaign performance you will be able to understand your customers and prepare upcoming campaigns in order to increase sales volume. By calculating the ROI of your eCommerce, you can simply identify products/services that are more popular than others among customers and focus your action on them. By doing so, you will ensure you are aiming to the right market segment and maximizing your sales. If you want to become a genuine marketer do not underestimate the importance of ROI and get more flexible in your approach to email marketing strategies. 


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