Calculate 'direct subscriber value' to demonstrate email marketing impact
Zach Heller, a contributor on business2community.com, explained that marketers should begin by working out the average number of recipients on an email list and then combining this with the total revenue generated per recipient.
To find out the latter, firms should use the average number of people who purchase via an email click-through and the average order value. Divide the total revenue figure by the average number of recipients, then multiply this number by the number of different emails sent each year to get an annual revenue figure per recipient.
Mr Heller remarked: "Hopefully there does not come a time when you have to convince someone that your emails have value. But if you ever should, it's a good idea to have something to answer them strongly. It's the direct subscriber value, and it's something you can figure out if you put in a bit of time."
While this algorithm takes into account the sales value of each recipient, it does not include the value of consumer data that email marketing lists also give firms. Writing for marketingweek.com, reporter Lara O'Reilly suggested a lack of data is what is putting some companies off social network advertising.
Whereas people can track their email click-through rates, there are restrictions on how much information a site such as Facebook will give marketers.