Imagine you logged into your bank account and noticed that your balance had mysteriously increased by $1,000. You had no idea where that money came from or why it was there. It just... happened.

The next morning, you logged in again. This time, your balance went down $500. The next day, it went back up $1,000. And the following day, it dropped all the way to zero—again, with no clues or insight into why that happened. No cause. No culprit. All you knew was that it happened.

Now, here's a dumb question: How would you react to those swings? Unless you're the most relaxed person in the world, you'd freak. Not just about being broke, but because you had no idea how or why it happened.

The Problem With Basic Email Metrics

Brands today have near-universal visibility into email opens and clicks, and excellent visibility into bounces. And although those metrics tell you something about your email marketing success, they lack the depth and granularity that's necessary to truly understand what's driving your successes and failures.

Similar to the obviously absurd "what if" scenario above, metrics like opens, clicks, and bounces tell you only that something's happening—not why or how it's happening. They're reactive, lagging measurements, not leading ones that help you make strategic decisions about your email investments. Yet, most brands' email strategies are underpinned by the former, not the latter.

In fact, according to Litmus's 2019 State of Email Analytics, nearly a quarter of brands can't track email interactions down to conversions. Fewer than half can measure their email marketing return on investment. And less than 28% of brands can measure subscriber lifetime value, which many consider to be the king of North Star metrics.

The good news? Most brands clearly recognize the weaknesses in their analytics.

The New KPIs of Email Marketing Success (And How to Track Them)

According to survey respondents in Litmus's report, the metrics that email marketers are most excited to start tracking are among the most strategic ones—metrics that say a lot more about the impact your email marketing strategy is having and how each email is actually performing.

So, what are those metrics? Here's where the marketers we surveyed think the future is headed with email marketing KPIs:

• Overall email revenue: Simply, this is the total amount of revenue generated by your email marketing activities.
• Subscriber lifetime value: A measure of the revenue generated by individual subscribers, which allows you to organize by cohorts or segments to evaluate whether—and why—some are more valuable than others.
• Email ROI: Once you know what your email marketing efforts are delivering—both total revenue and the revenue driven by campaign—you can start to assess the actual ROI of your email efforts, which makes it easier to invest where things are working and scale back where they aren't.

Now, those KPIs might seem obvious. But that doesn't mean they're easy to track.

In most cases, email service providers offer only surface-level analytics (opens, clicks, bounces, etc.) and Google Analytics goes just one layer deeper. As a result, third-party analytics are often key in helping email marketers measure those three metrics. And for the ones who do, success seems to follow. In Litmus's 2019 State of Email Analytics report, we found that users of third-party analytics were more than 50% more likely than nonusers to be able to measure KPIs like subscriber value.

Avoiding the Plague of KPI Bloat

As you set your email marketing strategy, stay focused on the "key" in key performance indicators.

After all, the purpose of a KPI is to keep your email program focused on the metric or metrics that matter most to its success. A KPI should act like a North Star, guiding your program in the right direction. And, ultimately, it can be difficult to find the right direction when you're frequently changing the star you're navigating toward.

Litmus research shows that brands track 4.3 email marketing KPIs, on average, with the median being 4.0. And though it's too subjective to suggest that four is the perfect number, what is clear is that the more KPIs you add, the more likely it is that you'll venture off course. As the old saying goes, "If everything is important, nothing is."

To be clear: all metrics have some value. It's just that the value they deliver isn't always equally valuable. To make sure you're focused on the ones with the highest impact, choose the most strategic, down-funnel metrics you have access to as your KPIs. Then, use the metrics that are closer to the surface as diagnostics to determine why your KPI is increasing or decreasing.

For instance, if you see a fall in deliverability and can draw a correlation to an increase in bounce rate, then you can make a reasonable connection of causation and create a clear course of action. And if you experienced a decrease in subscriber lifetime value and find a fall in value per subscriber, that might prompt a discussion of how to increase average order size, decrease list churn, and other related issues.

Want to learn more about the email metrics successful brands track—and how they do it? Check out Litmus's 2019 State of Email Analytics report by downloading it here.