Having an engaged group of subscribers for every email send would be a utopian dream for most marketers. With such a large focus on individual metrics and inter-campaign activity, we obsess about in-email activity and open rates – leaving our quieter subscribers open to being labeled as ‘inactive’ or valueless. But are those folks really all that bad?
To fully understand the impact of email list subscribers, we have to step back and look at the whole picture. Yes, there are folks who ultimately become your most loyal email recipients, opening and clicking through every send. These customers become visible to marketers by making purchases and creating revenues. Using that same purchase data, we can go further into identifying email subscriber values for the subsequent list mates.
Our friends over at MailChimp recently identified through 6.6 billion sends that inactive subscribers, on average, were estimated to be worth 32% that of an active email list participant. Meaning, lower engagement via email didn’t correlate to complete consumer inactivity. Email marketing subscribers without much email activity purchased more products and lengthened brand loyalty over non-subscribers, continually providing value.
This story is drastically different from the traditional view that non-active email recipients are just the same as non-subscribers. Looking at these numbers, we can make positive assumptions about keeping email lists whole and sending to those who passively interact too. Remember, email campaigns can drive in-store traffic just as much as ecommerce conversions.
Passive vs. Inactive Email Subscriber Example
Using these statistics and the infamous email return-on-investment data (38-to-1 or 3,800%), we can make a simple example of how passive subscribers continually provide value for email marketers. Let’s say we had:
- 1,000 subscribers on our list
- A 65/30/5 percentage split between ‘active,’ ‘inactive,’ and dead addresses
- 57% of traditionally ‘inactive’ are actually ‘passive’ recipients
Traditionally, lots of marketers would segment the list into a couple of groups to increase relevance, reduce send costs, and improve deliverability. Segmentation typically causes the removal of ‘inactives’ from the campaign as well as email addresses that are no longer valid. The example below shows this breakdown.
With this segmentation data, some marketers may consider creating multiple campaigns, one for each subscriber type – the primary campaign for active addresses and one for re-engagement, or potentially, an effort to reallocate subscription types using a subscription center to manage sends.
In this example, 57% of ‘inactive’ subscribers are actually ‘passive’, not completely disengaged. Also, we now know that our ‘passive’ email recipients are worth relatively 32% of our top email subscribers thanks to MailChimp. It gets interesting.
After reallocation, there are almost 20% more subscribers that could be a part of the original campaign instead of receiving a win-back type message. Adding these folks back into the fold for another email-driven interaction revives the email list without the use of additional campaign segmentation.
ROI from Passive Email Subscribers
Now that we have an idea of how much impact adding those ‘passive’ emails back into the primary campaign looks like let’s look at some theoretical return-on-investment data. The original send was segmented into Active, Inactive, and Dead Emails. We’ll assume that the Active and Inactive are on different campaigns, as traditionally Inactive are segmented into peripheral win-back-type campaigns.
List: 650 Active Recipients
Send cost: ($0.01 x 650) = $6.50
Campaign ROI: $6.50 x 38 = $247.00 (Infamous email ROI stat)
Send to Traditional and Passive Subscribers
List: 650 Active recipients + 171 Passive recipients
Send cost: $0.01 x 821 = $8.21
Campaign ROI: $6.50 x 38 = $247.00 (Infamous email ROI stat – 3,800%)
With an additional ($1.71 x 38)*0.32 = $20.79 from Passive recipients.
Total Campaign ROI: $247 + $20.79 = $267.79 (a 9.2% boost in revenue)
Passive vs. Inactive Email Summary
While this example is small in numbers, scaling the math to fit a larger email send can show impressive returns for marketers. It’s also a great jumping-off point for internal communications around segmentation strategy. Removing ‘inactive’ recipients can be an active removal of revenue from the email/ecommerce channel. Being data-driven around each send can show more than just website traffic, but prove that email can influence consumers to become engaged offline as well.
Next time there’s an opportunity to segment inactive subscribers from the primary campaign, think twice about how customers interact with the business before removing them. You may be losing an opportunity to capture 10% in additional revenue.