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May 31, 2022

Email churn refers to the percentage of subscribers that opt-out of your email marketing list. Your list churn rate is further broken down into transparent churn and opaque churn.

List Churn: Why Subscribers Opt-Out

A high list churn indicates that the message has lost its relevance or that the topics it covers are no longer of interest to its readers.

Transparent Churn

With transparent churn, it is clear when a subscriber has stopped getting emails from you.

There are many reasons why subscribers may stop getting emails from you. The most obvious reason is when they choose to unsubscribe or report your email as spam. 

Sometimes a subscriber may stop receiving your emails due to no action on their part, such as a hard bounce.

Opaque Churn

Opaque churn is where the subscriber is no longer receiving your email but it may not be obvious.

Sometimes emails are sent to their junk or trash folders. This can also happen when emailing the wrong email address.

Some people use secondary email addresses to sign up for offers.

How to Measure List Churn

List churn rate is measured over a set period. Unless your list is very large and very active, calculating your annual churn is usually the most accurate way to measure attrition.

Most email marketing experts focus their strategies on their transparent churn as this is much easier to accurately track. To figure out your transparent churn rate, you’ll need to know the size of your current email list.

You will also need these 12-months worth of customer attrition data:

  • Spam complaints
  • Hard and soft bounces
  • Unsubscribe activity

Once you have this information, calculating your transparent churn rate is relatively simple.

Churn rate = transparent churn metrics / list size

Calculating your opaque churn rate will require more work as you will need to determine your opaque churn metrics.

  • What percentage of emails are reaching your subscribers’ inbox
  • The number of email subscribers who have not opened your emails over the past 12 months

Most email service providers will have stats on your email deliverability. This is typically referred to as your “inbox placement”.

If 80% of emails are making it to a subscriber’s email, that means 20% are not.

You can now calculate your total churn rate as:

Total churn rate = (transparent churn metrics + opaque churn metrics) / email list size

By determining your rate of total attrition, you can gauge the success of your various retention strategies. You can then implement these different strategies for minimizing your list churn.

How to Reduce List Churn

Considering that it takes so much time, energy, and money to acquire a new subscriber, it’s surprising that so many will abandon their subscription. But it’s important to remember that this is only the average.

Many email marketers do a good job of retaining their subscribers.

According to one study, the top 10% of email marketers saw a first-year retention rate of 84%. In comparison, the retention rate for the bottom 10% was only 26%.

You can expect to lose up to a third of your email subscribers to churn each year. The drop-off is especially big in the first year.

Studies have found that most email subscriber lists will lose most of their subscribers within the first year of joining.

How, then, can you reduce list churn?

1. Segment Your Email Marketing Campaigns

One of the reasons that people no longer open your newsletter is because it’s irrelevant to them.

The solution to this problem is segmentation. This is where you segment your market into different groups based on their demographics, behavior, interests, and personal preferences. By doing this, you can send them more targeted and relevant emails, which will lead to better engagement and conversions.

Segmenting your email marketing campaign has been shown to increase email open rates by 14.32%.

You can segment your subscriber list by creating separate landing pages for each of your offers. Or, you can tag your subscribers based on their interests, allowing you to send them targeted emails.

2. Customize Your Welcome Email

A welcome email is the first email you send out to your subscribers after they join your mailing list. Brands that send a welcome email to new subscribers see 33% higher open rates.

The welcome email is your first opportunity to make a good impression on your newest subscriber. It’s your chance to introduce them to your company and brand.

A welcome email to new subscribers can be used to offer them the chance to customize their subscription. You can let them choose which types of content and special offers they’d like to get.

By segmenting your subscribers and sending them dynamic emails, you can ensure that they’re only receiving content that they actually want to read.

3. Reward Subscriber Loyalty

Give subscribers a reason to remain subscribed to your mailing list. Offer them rewards or incentives to encourage them to continue receiving your emails.

A simple “thank you” can go a long way.

A great way to reward your loyal email readers is to give them an exclusive discount on your product.

Or, give them exclusive access or special offers to content that is unavailable to everyone else.

4. Remember Milestones

People love feeling appreciated, and one of the easiest ways to do so is by remembering their birthday and anniversary.

On your subscriber’s birthday, send them an email with a special discount or offer.

If you don’t already have the birthdays of your subscribers on your list, you can instead offer a reward on their first anniversary. This can be sent after they’ve joined your mailing list for 6 or 12 months.

Conclusion

According to CMI, it costs $150 on average to acquire a new email subscriber and the average return on that customer is $234.

While your CAC won’t necessarily be affected by your rate of customer turnover, your ARR can be. By improving the percentage of subscribers who stay on your list, you can improve the return you get from your email marketing efforts.

To reduce list churn, calculate your present rate of subscriber loss, then develop strategies to reduce that percentage.

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