FIVE reasons why open reach will revolutionise your email marketing

Pretty big claim! But we’ve been measuring open reach across a range of clients and industries for seven years and have unearthed a wealth of valuable insights that underline why this metric should become the lynchpin of your marketing strategy.

So what is open reach?
It’s a customer engagement metric that measures the proportion of your base who have opened at least one message over a period of time. You can apply reach to all standard metrics, like click or purchase, but here we are focusing on open reach.

And how do you measure it?
Open reach is calculated by counting the number of subscribers on your list that have opened at least once and dividing that by the number of subscribers that have received at least one email from you over a given time period. This could be a quarter or a year, depending on your send frequency and specific goals.


Now to the juicy bit, those five reasons why open reach will revolutionise your email marketing:

1. Forget “what are my campaigns doing” – learn “what are my customers doing”
How often do you ask “what are my customers doing?” And yet, nearly all email metrics answer something different – “what are my campaigns doing?” So why is this disconnect in our industry? Because conventional email metrics, like open and click, only measure the performance of individual campaigns. They do not give you any insight into customer behaviour. However, open reach doesn’t just assess the value of the content and creative of your individual mailings, it also builds a clear picture of the overall performance of your campaigns and the health of your database.

Consider this example: if your newsletter has an average open rate of 21%, does that mean that after sending out 5 messages, every subscriber has opened at least one message? Maybe, maybe not.  It is far more likely that there is a group of subscribers that open every email as well as a group that never open. But that is just an educated guess. There is no way of gaining this valuable learning about your customers by looking at open rate. You have to use open reach to find the answer.

2. Want to improve your revenue? Just improve your open reach
We’ve noticed that a significant chunk of total revenue is generated when customers who have never opened or haven’t opened for ages, open one of your emails for the first time (graph 1). Although multiple openers have a much higher response rate than first time openers, they account for only a small percentage of total revenue over a given period because they are a much smaller group. First time openers generate significantly more total revenue in the same period because they are a much larger group.

Although it’s easy (and common) to focus on the small group with the best response rate because the open and clicks look great, it’s the much larger lower-responding group that will give you the biggest increase in your total revenue.  So the short term goal of increasing open and click rates is replaced by the longer term strategy of converting non-openers into first time openers, and then those first time openers into the higher-responding  multiple openers group. All you have to do is unearth the different ways to move your customers up the engagement chain. And guess what, open reach shows you the best way to do that …

Graph 1
Graph 1

3. Customers and prospects behave differently – so treat them differently
So, how do you move your customers up the chain? First, you have to understand how first time openers and multiple openers respond to your emails in comparison to each other. Let’s say you send out a free delivery offer to your entire base. Open rates and revenue for that campaign are both above average. You send out a SAVE 20% offer and both metrics are again above average. They are both a success, right? So based on those metrics you would keep sending these two different types of offer to your entire base.

But look at the open reach for these offers and you’d see that the free delivery had very little effect on cumulative first time opens, whereas the discount offer had significantly more. A free delivery offer has less interest to someone who isn’t buying regularly but does appeal to someone who is. Likewise, a juicy discount is far more likely to engage someone who has been inactive for a while. By analysing open reach you can identify what appeals to these different groups and target them with the appropriate offer and message. Your customers are telling you how they want to engage with your brand, so use open reach to listen, learn and lift your response.

4. Isn’t reactivation an expensive chore? Then start doing it with every email you send
Now you’ve identified your different groups in the engagement chain and how to press their buttons, you’ll notice that the first step in the chain – non-opener to first time openers – is actually the same as reactivating inactives. So you can stop thinking of them as inactives and start thinking of them as opted-in prospects (graph 2). You’ll rarely have to bother with a one-off, low-margin reactivation campaign because every email you send will be a reactivation opportunity.

And it doesn’t just stop there. The insights you gain from analysing what motivates your non-openers to become first time openers will inform your new reactivation strategy. There’s no need to send pleading “we miss you emails” when your open reach analysis is telling you that a SAVE 20% offer has significantly increased first time openers. That’s a measurable trigger for this group, so use it and all the other customer insights open reach will drop in your lap.

Graph 2
Graph 2

5. Learn what really drives engagement
Open reach will also show you that new subscribers to your list are the most likely to become first time openers. Sounds obvious, so why is it important? Well, in essence this is saying that one of the best ways to increase your revenue is to grow your list. New subscribers = increased first time openers = more revenue. But, while growing your list is an important part of any email strategy, it is an expensive way to increase revenue.

There is a more cost effective way and, you’ve guessed it, it can be identified and optimised using open reach. It’s frequency. Periodically increasing the frequency of your emails increases your first time openers. In graph 3 below, a client who was sending a monthly email changed to a weekly. Result? The monthly had an open rate of 17%, while the weekly emails averaged just 10%. However, when the open reach was measured the weekly emails were found to have significantly increased the number of first time openers. Total opens for monthly = 9,008, total opens for weekly over the same period = 21,006 (unsubscribes were statistically insignificant). Inactives were engaged by extra sends because, to state the obvious, they had three more opportunities to do so.  Had only conventional metrics been used to measure this test, then it would have been seen as a failure. Increased frequency = more opportunities to engage = better open reach = more revenue in the long run. And which one of your stakeholders could argue with that?

Graph 3
Graph 3

 Your 5-step plan:

1)      Start measuring your open reach and see what your customers are doing
2)      Identify your non-openers, first time openers and multiple openers
3)      Compare the behaviour of each group and use that knowledge to target them
4)      Treat your non-openers as opted in prospects and reactivate them with every email
5)      Increase your revenue by increasing  your open reach by increasing your frequency

  • http://twitter.com/JenMcGahan Jen McGahan

    Nice post. Do you know of a software program or ESP that calculates open reach or do you offer these analytics through Alchemy Worx?

  • Daniel Reardon

    When you say, “the number of subscribers on your list that have opened at least once and dividing that by the number of subscribers that have received at least one email from you over a given time period”, does that mean looking at both metrics (Open & Sent) for a given time period? Or does it mean that only Sent is for a given time period?

  • Alchemy Worx

    Hi Daniel,

    First of all, we tend to look at Delivered rather than Sent volumes as the ratio between Opens and Delivered is a slightly better measure of response vs. opportunity to respond, so I’ll answer substituting Delivered for Sent.

    Yes, we look at both Open and Delivered over a given time period. Let’s say you want to measure Open Reach for the six months of H1 2012 – you’d need to download a list of all email addresses that were delivered to for all mailings in this period (the same as all sent email addresses that didn’t bounce every time they were sent to), then also download all the email addresses that registered an Open for all mailings in that period. De-duplicate both lists so that each list contains a given email address only once (but the same email address can appear on both lists). Then divide the count of unique opened by unique delivered and you have the open reach for that 6 months.

    If you or anyone would like more detail or have us crunch your data, just drop an email to info@alchemyworx.com and we’ll be happy to discuss.

  • Alchemy Worx

    Hi Jen,

    Glad you liked the article. We are not aware of an off-the-shelf tool for measuring open reach; we use a proprietary tool developed here at Alchemy Worx to do this. A number of ESPs can run counts for a given query of the number of opens on a group of mailings or time period but this will not provide you with the granularity you need to optimise your campaigns or allow you to generate reports like those described in our article.

  • http://twitter.com/DylanMailz Dylan Murphy

    Nice Post, Thanks!

  • Kate Gowers

    The tool I use can indeed calculate unique delivered over a given time period and unique opens (say) over a given time period (it has a single customer view, which is nice). However, I’m now curious as to whether this will be quite as useful as your example, given that the client I am looking at never sends to its entire base (it’s split into brands, for example and emails are generally at least partly targetted). So someone might receive an email (and open it…or not) for one brand but either receive an email for another brand and not open it or receive an email for another brand and open it.

    I’m not sure, therefore, of the best way of using this data.

  • Alchemy Worx

    Hi Kate, that’s one of the limitations of most email platforms – several of them allow you to count subscribers that opened or didn’t open over a given time period, but they don’t automatically give you this level of detail or chart the numbers over time. This is why we chose to develop our own software to carry out this analysis.

  • Pete Noble – Communicator

    The communicator platform is an ESP with an integrated tool that we refer to as engagement monitoring. It can be applied across everything from opens to click through an conversion rates.