What email ROI measures
This calculator compares tracked email revenue with the cost assigned to the email program. Costs can include software, creative, production, agency or team expenses if the business chooses to include them consistently.
Tracked revenue is not necessarily incremental revenue. Attribution windows can credit email with orders that other channels also influenced, so ROI should be interpreted with the attribution method documented.
Revenue-to-cost ratio = tracked revenue ÷ program cost. This is different from profit after product and fulfillment costs.
Worked example
An email program is credited with $48,000 in revenue and costs $8,000 for software, creative and operations. Revenue-to-cost is 6.0x and the simple revenue-based ROI is 500%. If contribution margin is low, actual profit ROI can be much lower.
How to use the result
Use a consistent cost scope. A monthly program ROI that includes software and staff should not be compared with a campaign ROI that includes only sending cost. For a profit view, replace tracked revenue with contribution generated by email orders.
Common mistakes
- Calling attributed revenue incremental revenue without an experiment.
- Leaving major program costs out in one period and including them in another.
- Confusing revenue ROI with profit ROI.
When to recalculate
Recalculate for consistent periods and after material changes in costs, attribution settings, sending strategy or promotion mix.
Frequently asked questions
Can email ROI be negative?
Yes. If tracked revenue is lower than the cost assigned to the program, the simple ROI is negative.
Should I use revenue or contribution?
Revenue is easier to calculate, but contribution produces a more economic view because it accounts for variable order costs.