An email marketing ROI calculator is a tool used to measure the return on investment (ROI) of an email marketing campaign. It is used to calculate the profitability of an email campaign by taking into account the cost of running the campaign, the number of people who responded to it, and the amount of money generated from those responses.
To calculate an email marketing ROI, you need to know four components:
Total Audience Size: This is the total number of people who received your email campaign.
Campaign Cost: This is the total cost associated with running your email campaign.
Response Rate: This is the percentage of people who clicked on your email call-to-action out of your total audience size.
Conversion Rate to Purchase: This is the percentage of people who responded to your email and then purchased something from you or took some other desired action (e.g., signing up for a newsletter).
Average Order Value: This is the average amount spent by customers who responded to your email and purchased something from you or took some other desired action (e.g., signing up for a newsletter).
The formula for calculating an email marketing ROI is as follows:
ROI = ((Total Audience Size x Response Rate x Conversion Rate to Purchase x Average Order Value) - Campaign Cost) / Campaign Cost