Last updated: March 2025
Quick Answer
To calculate email marketing ROI, subtract the campaign cost from the total revenue generated. Then, divide that number (the profit) by the campaign cost, and multiply by 100 to get a percentage. Email marketing typically generates the highest ROI of any digital marketing channel.
Key Takeaways
- ✓ The Math: ROI = [(Total Revenue - Campaign Cost) / Campaign Cost] * 100.
- ✓ Compounding Factors: A small increase in both your open rate and your landing page conversion rate compounds exponentially to generate massive ROI gains.
- ✓ Measure Total Costs: Don't just factor in your ESP (Email Service Provider) monthly fee. Include the hourly cost of the copywriter or designer who built the campaign.
How to Read Your Email Campaign Funnel
Email marketing is a numbers game governed by a funnel. An improvement at the top of the funnel (Open Rate) creates a larger pool of people at the bottom of the funnel (Conversions).
- Low Open Rates: Indicates an unengaged list or poor subject lines. Test shorter subjects, emojis, and personalization.
- High Opens, Low Clicks: Your subject line promised something that the email copy didn't deliver, or your Call to Action (CTA) button was hidden.
- High Clicks, Low Conversions: The email did its job, but the landing page failed. This usually indicates a pricing issue, a broken checkout process, or a mismatch in expectations.
Frequently Asked Questions
What is a good Email Marketing ROI?
Email marketing famously has one of the highest returns on investment of any marketing channel. A widely cited industry average is a $36 to $42 return for every $1 spent (an ROI of 3,500% to 4,100%).
What is an average open rate and click-through rate (CTR)?
Across all industries, average open rates range from 18% to 22%, and average click-through rates range from 2% to 3%.
How can I improve my Email ROI?
The fastest ways to improve email ROI are: cleaning your list regularly (removing inactive subscribers), segmenting your list so you send more relevant offers, running A/B tests on your subject lines, and optimizing the landing page that users click through to.