The most effective and reliable marketing tool your business has is its email list. In terms of return on investment (ROI), nothing else — social media, AdWords, SEO — even comes close. Unfortunately, email marketing also has a major drawback. To maintain the effectiveness of this channel, your email lists need to be actively cultivated, managed, and updated. When your email marketing resources aren’t handled properly, your campaign results quickly begin to atrophy.
One of the first signs that there’s a problem is an increase in the email bounce rate. This key performance indicator (KPI) allows marketers to see how many of their emails “bounce” back from the addresses on their list. If the bounce rate is steadily rising, it’s a clear indication that there’s trouble brewing in the company’s email marketing methodology.
To understand why the bounce rate is such an important KPI, it’s important to explain what the bounce rate actually measures. It’s a surprisingly simple calculation. Take the number of bounced emails in a given campaign, and then divide them by the total number of emails sent out in that campaign. Take that number and multiply it by 100. The resulting product is the bounce rate.
For example, if 1,500 emails bounced back from a campaign with 125,000 recipients, the bounce rate would be 1.2%. As bounce rates go, that’s not bad.
Most marketers would expect to see a 2% bounce rate on a typical campaign. Bounce rates can vary significantly over time — anything up to 5% is widely viewed as acceptable — and a sudden spike in the bounce rate in a single email or campaign isn’t necessarily cause for alarm. One example of this would be an increase in “soft” bounces caused by temporary technical or network issues. The real concern is a steady increase in the email bounce rate over time.
What we’re really concerned with here are “hard” bounces. These can be caused by a wide variety of issues, such an email address that no longer exists or an email that belongs to an expired domain name. The worst-case scenario, however, is that campaign emails are being bounced because they were blocked from being delivered at all. When this happens, it’s usually because the sending address — your marketing email address, or even your entire domain name — was placed on a spam blacklist. That’s a problem you want to avoid at all costs.
To keep your bounce rate as a reasonable level, it pays to follow some basic guidelines.
Here are five of the most important things to get right:
If you don’t want to find your email address or domain name blacklisted, don’t send emails that look like spam messages. Avoid spammer-like language (“act now!”), pay attention to your formatting, and always include your company’s contact information. Also, don’t do sketchy things like buying email lists from questionable sources, as using these lists can increase the odds of your emails getting flagged as spam.
One of the most effective ways to reduce your bounce rate is to regularly review the addresses that bounced, and then remove those which are no longer active. If you’re a B2B company, for instance, you may be sending hundreds of emails to contacts who have since moved to other companies, or even to companies that no longer exist.
The best email marketing results come from lists with highly engaged recipients. People who opt-in to your newsletters and email updates tend to have very high conversion rates, and this is even more true for those who follow through on a “Confirm your account” link sent after their initial sign up. Your company may see slower email list growth using this method, but your bounce rates will also be extremely low. More importantly, your marketing ROI with these engaged subscribers will tend to be very high.
Your company may have emails from a wide variety of sources — signups from promotions and trade shows, emails from lead generation on your website, customer lists — making it a challenge to craft an effective marketing message that fits all of these groups. So don’t try to. Instead, segment your marketing lists by bounce rate. This allows your marketing team to focus on your most engaged subscribers first. It also justifies investing less resources in reaching those less-engaged, lower ROI segments.
It’s always a good idea to A/B test your marketing. There’s even more value to doing this if your bounce rate is increasing. For example, by tweaking the language and formatting of your emails, you may discover that something in your content is triggering a spam filter.
By consistently applying these tips to your email marketing campaigns, you can gain a new level control over your bounce rate. This allows you to keep this all-important KPI steady, while also giving you new methods for maximizing your campaign ROI.
These tips only scratch the surface of what’s possible for optimizing your company’s email marketing results. To take your results to the next level, you need more than a quick blog post. You need expert insights. Let FayeBSG show you what’s possible. Contact us today for a no-risk consultation.