Email Marketing ROI Calculator

The figure most often quoted is $36 to $42 in sales for every $1 spent, from industry surveys by Litmus and the DMA. That's revenue per dollar, not profit, and it comes from companies that already run email well. The example returns $4.50 in sales per $1 and a 125% ROI on gross profit. Use your own numbers; a small list with a low click rate earns far less.

Email ROI = (gross profit from email sales − email costs) ÷ email costs × 100. Gross profit is orders × order value × margin. Orders are list size × emails sent × click rate × conversion rate. In the example: 10,000 × 4 × 2% × 3% is 24 orders a month at the start, about $720 in sales and $360 in gross profit, against $300 in cost.

Because revenue includes the cost of the products you sell. A $60 order at a 50% margin leaves $30 to pay for marketing. Revenue-based ROI makes every channel look better than it is and can hide a loss. If you only want revenue per dollar, divide sales by cost: the example's $16,197 in sales on $3,600 is $4.50 per $1.

Most marketing emails see click rates of 1% to 3% of subscribers. Newsletters people asked for often do better, and cold or old lists do worse. Click rate matters more than open rate now, because privacy features in mail apps inflate opens. In the example, each 1 point of click rate is worth about $8,100 in sales a year.

Divide your yearly gross profit from email by the number of subscribers. In the example, each subscriber is worth about $0.91 a year in gross profit. That sets the most you can pay to win one and still profit in a year. If subscribers stay for 3 years, you can afford about three times as much, before costs.

As often as people still click. In the example, going from 4 to 8 emails a month doubles sales, as long as click rates hold. Click rates usually fall and unsubscribes rise if you send more than readers want. Raise frequency slowly and watch click rate and unsubscribes for a few weeks.

Every list loses people to unsubscribes, bounces and abandoned inboxes. At 1% a month, the example's list falls from 10,000 to 8,864 in a year. With no churn, ROI would be 140% instead of 125%. Under More options, set your churn and the sign-ups you add, and the calculator tracks the list month by month.

Include your email platform, design and writing time, any agency fees, and the cost of new subscribers, such as ads or discounts. Include staff time at its hourly cost if someone on your team writes the emails. Leave out costs you'd pay anyway, such as your website.

Email usually returns more per dollar because you own the list and sending is cheap. Social ads reach new people that email can't. In our calculators' examples, email returns 125% and paid social 20%. Many businesses use social to win subscribers, then email to sell to them.

Tag every link with UTM codes so your analytics can tie sales to each email. Most email and ecommerce platforms also report revenue per campaign. Compare that revenue with your monthly email costs each quarter, and enter those real numbers here to see the profit after costs.