3 Common barriers to effectively calculating email marketing ROI and what to do about them | DMA

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3 Common barriers to effectively calculating email marketing ROI and what to do about them


“If you can’t measure it, you can’t improve it.”

Kate Barrett, Shine a Light Media

Email marketing has one of the highest Return on Investment (ROI) of all online marketing channels; Email has an average ROI of £38 for each £1 spent (DMA National Client Email Report 2015).

But half of companies are still not able to calculate this important figure and many still rely on opens, clicks and other top level metrics alone to analyse the performance of their campaigns.

“Determining ROI is an increasing problem for the whole industry. Those able to calculate ROI has fallen steadily since 2012. In 2015 half of marketers could calculate the ROI on their marketing. For B2B marketers, the situation is worse still and the proportion unable to calculate ROI rises to 60%.” DMA Email Tracker Report 2016

ROI is one of the most useful measures of marketing success - particularly for those businesses (such as ecommerce) who are actively seeking a sale in many of the emails they send. Because if the activities you’re carrying out aren’t generating a significant return on investment, you need to be able to identify these specific campaigns or overall channels and move your budget to other areas that are performing better.

However, the way in which people interact and engage has become increasingly complex and made direct attribution of revenue much harder - this has resulted in the number of businesses who can calculate ROI from email marketing seeing a decline year-on-year.

There are many reasons why you may not be able to calculate ROI, but to get you thinking about what may be holding your company back, 3 of the main barriers include…

Lack of time/resources dedicated to calculating email marketing ROI

Email marketing roi

According to the DMA Email Tracker Report 2016 fewer than one in three email marketers (30%) said ROI is one of the most important metrics to measure, possibly because falling numbers able to calculate this figure in the first place. The majority choose vanity or process metrics as the most important measures for campaign effectiveness, such as click-through rates (80%, up from 70% in 2014), open rates (65%, up from 60% in 2014), and conversion rates (50%, down from 56% in 2014).

So if you’re not dedicating time to calculating this metric, how can you accurately know how well your email campaigns are performing from a revenue stand point? You can’t make a change without having hard facts in front of you to guide the way - otherwise, what are we testing for?!


You need to ensure you have a process in place and time to set aside to report back on the success of an individual email, campaign or time period regularly, including not only the basic metrics (such as opens, clicks etc.), but also a ROI calculation to give you the full picture of the success of your activity.

By taking some time to view your reports and measure the success of your email marketing you’ll have firm data in your hands that shows the impact your efforts are having on the business - a great thing to have if you need to fight for a current budget or even ask for an increase to expand your email marketing strategy or available resources.

NOTE: Want to know how to calculate ROI for your email marketing campaigns?

At its simplest level, as with any form of marketing ROI, the typical calculation is:

(Revenue Generated - Cost) X 100


(E.g. You spent £1500 on creating an email campaign. You sent it to 50,000 people, got a 30% open rate (15,000 opens), 5% click rate (750) and 125 of those people then bought a product at £50 each = a total revenue of £6,250. Your ROI for this project would be: ((£6,250 - £1500) / £1500) x 100 = 317%)

Unable to accurately calculate email marketing investment figures

When trying to calculate the cost of an email send, the basic numbers spring straight to mind such as the cost to send the campaign through your Email Service Provider (ESP). But what about some of the other costs involved in getting everything ready and out the door?

The cost of using a consultant to help you plan or implement your strategy, the 3rd party testing/analysis system you’re using (such as Litmus or Return Path for example) or the external agency to design, build, write copy for or manage the send for you? Or even an associated cost of using in-house resources (staff hours) for any of these tasks?

In order to calculate an accurate number you need to have the right figures to hand in the first place.

Knowing the ROI of your email marketing will help you determine if you should be putting more or less focus behind specific email marketing campaigns, techniques or strategies, how your efforts are stacking up against other marketing channels in your business and the differences that could be generated in the future with changes to specific metrics within the calculation (such as the impact of increase open/click rates on ROI).


Ensure that when you are calculating ROI you have all the costs associated with your email marketing to hand and include them in your investment figure.

Lack of tracking to purchase

Many companies still operate with their data in distinct and separate silos throughout the business which obstructs a single customer view being seen. So if (for example) purchase information is separate and unable to integrate with you ESP (Email Service Provider), you may not be able to directly track conversions from your email marketing.

A Multichannel approach is also often taken, with a campaign being run across many different marketing channels including email, plus there is not just one avenue in many cases for customers to purchase.

email marketing actions

For example, the DMA’s Consumer Email Tracker 2015 suggests that a significant proportion of consumers who receive emails that interest them will not always respond to the click offered, and instead turn to search, to social or even look in-store.

ROI from email campaigns may therefore be greater than last click attribution metrics may indicate if, for example, consumers go to into a shop, rather than taking the direct click as the action from the email.


Creating a single customer view with all your data available is the nirvana of marketing professionals everywhere - and in reality, in many cases this is no easy task. But it’s one that can pay dividends in the long run with decreased storage costs and training for staff on multiple systems, as well as a better understanding of the customer journey, needs and return on investment from campaigns across all marketing channels.

Ultimately, you need to ensure you have a system in place to track where your sales are coming from as best you can:

Tracking direct online sales.

In order to tack your customer journey and online sales, you need to make sure you have a system in place to track a users activity from the email through to the sale. This could be through adding tracking links to your email campaigns for use with a system like Google analytics or tracking through your purchase systems or ESP. By tracking certain pages of your website, you can track which pages your contacts go to after clicking a link in your email.

Tracking other online sales.

Unless you are using tracked links to monitor the original source of a link (such as Google Analytics) so that when it’s shared via social media for example, this is still tracked, this may prove much harder to track.

Tracking offline sales.

Where sales occur offline, this can be a little more tricky; one (by no means foolproof) way of doing this is to ask any new customer at the point of purchase how they found out about you and then record this information as part of a customer database (or perhaps loyalty scheme). Another option would be to use exclusive special offer codes/vouchers within your emails to redeem in store.

Now of course, ROI is not the be all and end all - you may have company objectives to increase brand awareness or sentiment which are just as important. But calculating a return on what you are spending is also a fundamental business calculation that should be made to make sure ANY channel you are spending money on is worthwhile to invest in, in the future.

Are you avoiding calculating your ROI for any of these reasons? How are you planning to overcome these challenges are ensure you’re calculating email marketing ROI in your business? Or have you overcome them already and been surprised at the results?

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