How To Calculate ROI for Email Marketing

Email Marketing ROI

email marketing calculator

Calculating the Return on Investment (ROI) from email marketing involves a few steps to understand the financial returns relative to the costs involved.

Here’s a basic method to calculate it:

Calculate the Total Revenue Generated from Email Marketing

This involves tracking how many sales were directly generated from your email marketing campaigns. You’ll need to have a system in place (like UTM tracking in Google Analytics) to track these sales.

Calculate the Total Cost of Email Marketing

This includes all costs associated with your email marketing efforts. It could be the cost of your email marketing platform, any paid design or copywriting services, and any other direct costs involved in creating and sending the emails.

Calculate the Net Profit

Subtract the total cost from the total revenue generated.

Calculate the ROI

The ROI is calculated as (Net Profit / Total Cost) * 100. This gives you the ROI as a percentage.

Email Marketing ROI Formula

email marketing roi forumla
Email Marketing ROI = (Total Revenue from Email Marketing−Total Cost of Email Marketing Total Cost of Email Marketing)×100
 
For example, if you made $5,000 in sales from email marketing and spent $1,000 on it, your ROI would be:

ROI=(5000−10001000)×100= 400%

This means for every dollar spent on email marketing, you earned $4 in return.

It’s important to regularly calculate and monitor this metric to understand the effectiveness of your email marketing campaigns and make informed decisions for future strategies.