The document summarizes key findings from a report on email marketing trends in North America in 2014. It finds that email metrics like open rates and click-through rates improved over the past year. The increased use of mobile devices has positively impacted email engagement. While list growth remains a challenge, email marketers are taking a more diligent approach to list hygiene and content strategy to improve relevancy and reduce subscriber fatigue and inactivity. Ongoing regulation and scrutiny requires marketers to follow best practices to maintain high deliverability and compliance.

1. NORTH AMERICAN
EMAIL MARKETING
TRENDS 2014
AN INBOX MARKETER WHITEPAPER
1
© 2014 Inbox Marketer Corporation

2. Executive
Summary
In the 2014 edition of our North American Email
Marketing Trends Report we discuss the major
factors impacting email marketing including, the
impact of mobile devices, increasing regulation
Throughout the last year Email Marketing
and legislation, Inactives & email list fatigue
continued its momentum and reaffirmed its
and list growth vs. unsubscribe rates. We also
effectiveness as a digital messaging channel.
provide a commentary on email metric trends
Inbox Marketer data showed upward trends
and North American benchmarks at the year-
for all key metrics. The increased penetration
end 2013.
of mobile devices has had a positive impact
on email because mobile allows people to
The data from this report is from a cross-section
check their email anywhere and when they are
of B2C & B2B clients across a variety of industry
on the go. A report published by McKinsey &
sectors. Most of the campaigns were deployed
Company affirms that “91% of all US consumers
from opt-in permission lists (house files) and the
still use e-mail daily” and that email remains
following charts highlight the annual averages
a “significantly more effective way to acquire
and the commentary that follows further
customers than social media—nearly 40 times
explains the “year over year” changes and any
that of Facebook and Twitter combined.”
significant differences.
Highlights
• Email metrics continually improved over the
past few years
• Deliverability is a critical factor for better metrics;
eLeaders should strive for deliverability over 90% IPR
• In 2013, Open Rates improved and now average
24.3%; Click-Through Rates increased slightly and
now average 6.0%
• When comparing metrics, adjust your benchmarks
against your sector competitors, but also look at what
leaders in other sectors are doing and learn from their
successes and failures
• Email marketers are taking a more diligent approach
to list hygiene, as well as implementing content strategy
best practices
2
• Email marketing is powerful but getting more
complex; marketers need a plan to keep their content
& contact strategies relevant
© 2014 Inbox Marketer Corporation

3. Introduction
The following is a commentary on email metric trends
and North American benchmarks up to Q4 2013.
Inbox Marketer tabulated the engagement metrics from
B2C and B2B clients across a variety of industry sectors.
Some industry pundits describe email as the old “diva”
who is a bit battered. Sure she may be a little older but
she still has talent and longevity. In numerous 2013
industry polls of marketing executives, email marketing
ranks as the first or second digital tool for generating
response results. Email is strong even with competition
for time from social and mobile. Email is an entrenched
habit for many people and the penetration of mobile
devices (smartphones and tablets) is well over 50% for
most sectors.
Email’s core strength is its adaptability and role as a
response medium that allows marketers to send a variety
of relevant information in a cross-section of vehicles. An
often overlooked benefit of email is its retention impact.
In 2013, one of Inbox Marketer’s clients generated a
+2% incremental increase in retention from their email
program. As outlined in Frederick Reichheld’s “Loyalty
Effect”, a 5% increase in retention can have a
30% - 70% lift in profits. Other clients also have seen
better retention, higher ROI and have proven that email
can change buying behavior. Using email strategically and
using journey paths can further reduce customer churn
(source: McKinsey & Company).
In this whitepaper you will see that many of the
clickstream metrics are improving or holding steady.
Email is strong (despite some industry naysayers)
because email marketers are becoming more disciplined
and they are constantly testing and optimizing.
Technological advancements in graphics and dynamic
targeting are also keeping email fresh. Responsive design
is making sure that email messages are readable on any
type of device.
SECTION 1:
4 Major Factors
Impacting Email
Marketing
1. The (Continuing) Penetration of Mobile & Devices
In 2013, mobile devices continued to significantly impact the email marketing industry. Buzzwords like “responsive”
and “scalable” are no longer buzzwords, but are now part of the email vernacular. The proportion of Opens attributed
to mobile is growing. As of Q4 2013 over 55% of all email opens are from a smartphone or tablet. Email marketers
have had to shift their strategies and tactics to a “mobile-first” mentality. It’s much easier to adjust a mobile email to a
desktop than it is to do the opposite and more email marketers made these adjustments in 2013.
Email marketers are in a battle for customer attention. Providing a positive experience is a critical factor in gaining –
and keeping – this attention. Email marketers must consider the full experience from the email design, copy, subject
line, and call to action through to landing pages and web forms. In 2014 it will be important for marketers to optimize
their messaging so that subscribers can view and interact with their email messaging using their preferred device
(i.e., phone, tablet, desktop).
3
© 2014 Inbox Marketer Corporation

4. 2. List Growth Challenges
Email marketers face constant pressure to grow their email lists. Email leaders with mature lists typically grow their
list by 15%-20% per year. The accepted theory is that the more records on a list the greater the revenue likely earned.
As a result, many email marketers are pressed to increase the number of records within their lists. On top of this,
email marketers are also tasked with reducing unsubscribes rates by keeping their current subscribers active and
engaged. This is a challenging task as, according to Ipsos-Reid, the average Canadian subscribes to 13 commercial
email programs including their financial services relationships, retailers and hobbies (we would expect similar numbers
across North America). As a result, marketers are in a constant battle for customer attention. An exploratory analysis
indicates that there is 10%-20% subscriber overlap between lists.
Most marketers understand these pressures all too well, but still give in to their strains by trying to accomplish too
much with too few resources. Instead a marketer’s first step should be creating a plan. They should decide early on
what the goals are and how they’re going to be achieved. While interruptions are inevitable, having a good road map to
start will ensure that you remain on task.
3. Inactives & Email List Fatigue
Subscriber fatigue can become a problem if sending frequency is too high and messages are not relevant. Be selective
on the messages you send. If someone is not in the market for your product then suppress their messages for a period
of time.
In the email world, “Inactives” are often defined as valid email subscribers who have not opened or clicked in the last
six months. Typically 40% of Inbox Marketer’s clients’ email base is classified as Inactive. These Inactives can have
an impact on your overall email metrics, but they may also be an unmined segment rich with potential revenue. Email
marketers should design campaigns targeted at these Inactives focusing on reactivating and reengaging them. First
steps can include a simple questionnaire asking if they’d like to continue receiving messages. From there, design a
message series to reengage and inspire them to interact with your messages.
Last year, Inbox Marketer introduced the Active Depreciation Rate (ADR), which measures the percentage of Active
subscribers who turn Inactive. The longer time period that individuals are part of a subscriber list, the higher the
probability they may simply get bored of receiving your messages, particularly if the messages always appear similar
(same template, look and feel).
4. The Impact of Greater Scrutiny
Consumers are getting more sensitive. In 2013, there were several reported data breaches at several large U.S.
companies. Data practices at Google and Facebook are also under the microscope. Industry Associations are trying to
be proactive and have set more stringent guidelines for email practices. The Canadian market is dealing with Canada’s
Anti-Spam Legislation (CASL) which comes into force on July 1, 2014 . CASL targets spammers and encourages
legitimate email marketers to follow best practices.
4
© 2014 Inbox Marketer Corporation

5. A Word
on Inactives
Subscriber inactivity is a fact for many marketers.
Customers can become saturated with information
from your company. Sometimes their priorities shift
and they don’t have time to open and read your email
messages or even let you know of their preference
changes (i.e., unsubscribing). Our research shows
that a between 17%-40% of an Active email base
will turn Inactive. Your goal should be to mitigate a
portion of that.
Inactives can be calculated using a few different
time periods. Epsilon uses a 12 month window
which is, in our opinion, too broad for today’s digital
world. For example, in their Q2 2013 Email Trends
and Benchmarks Report, Epsilon reported a 42.0%
average dormant rate for subscribers who have been
inactive for the past 12 months. A 12 month window
is a wide window and the Inactive proportion would
likely have been even higher if adjusted to a sixmonth window. Inbox Marketer suggests using
a 6 month window or less.
Figure 1 shows that the proportion of Inactives is
gradually decreasing with time. This suggests that
marketers are doing a better job at targeting their Inactive
segments. Notice that there was a significant drop
(4.5% incremental) between H1 2013 and H2 2013 which
can be partially attributable to the increased penetration
of mobile. Please note that 43.7% still represents a
significant proportion and marketers should continue
to look for new ways to reactivate and re-engage these
Inactive subscribers.
Not All Inactives Should
Receive the Same Treatment
Depending on the nature of the list and the type of messaging subscribers typically receive, there are a number of
methods in which to retarget Inactive segments. The first step is to think carefully about the types of subscribers you
are trying to reengage and create relevant messaging that will resonate with that audience. For example, if a customer
typically only receives a monthly newsletter, try to reengage them by executing a simple “Reactivation” campaign. Send
Inactives a survey, special offer or incentive that entices subscribers to interact once again.
The way you treat Inactives also varies depending on their purchase cycles. A food retailer would likely want to stay in
regular contact with their customer, keeping them up to date and informed on product information and in-store sales.
Whereas, with a prospect list, the time between messages may be much greater but, it may be still worthwhile to mail
someone for up to two years as they may still be in a contract with a competitor.
5
© 2014 Inbox Marketer Corporation

6. SECTION 2:
Open Rates
Trending Up
In 2013, Open Rates (OR) increased +2.3% to 24.3%
(up from 22.0% the previous year)! While Open Rates
are a good metric in which to measure and benchmark
subscriber engagement from one campaign to the next,
Open Rates simply indicate that recipients have viewed
an email message in their inbox which, doesn’t always
tell the whole story. It is also important to note that there
are often differences in measurement methodologies,
which explains why some ESPs often report higher Open
Rates (i.e., some ESPs use total or “gross” opens instead
of unique opens which skews their OR upwards). As a
result, it is important that marketers set benchmarks
using their own data and keep this in mind when
comparing the metrics of competitors within their
respective industry.
The calculation for Open Rates is OR% = (confirmed
unique opens)/ (sent messages - bounces).
A Closer Look at Open Rates
Inbox Marketer data shows that Open Rates peaked in 2009 and then declined to 19.2% in 2011. However, Open
Rates have stabilized in the past few years and in 2013 rose to 24.3%, nearly equal to 2009 levels. This year, looking
at ORs from a quarterly perspective, Open Rates increased each of the first three quarters and declined slightly in
Q4 (2013 Quarterly Results: Q1: 24.0%, Q2: 25.0%, Q3: 26.0%, Q4: 22.8%).
Click-to-Open
Rates (CTRO)
In simple terms, CTRO% tells the marketer: Of the
people who opened an email, what proportion clicked?
CTRO% is important when analyzing the effectiveness
of content. It helps normalize the impact of Open Rates
and provides a more true indication of how engaging
the email content appears. Figure 3 shows that CTRO%
behavior has been relatively steady for the last few years
and there isn’t any noticeable seasonality.
6
© 2014 Inbox Marketer Corporation

7. SECTION 3:
Click-through
Rate Trends
Click-through Rates (CTRs) declined from 20092011 but have since been on an upward trend. This is
great news for email marketers as CTRs indicate the
relevancy of email content and are an excellent measure
of engagement. Three factors that have contributed to
the increase in average CTR over the last three years
are: better list hygiene, a more diligent approach to
implementing email marketing best practices, and click
optimization. Email Marketers have done a much better
job of segmenting their lists, enabling them to send
more relevant messaging to their subscribers, in formats
that are optimized for their preferred device (i.e., phone,
tablet, desktop). As a rule of thumb, messaging that is
customer (“me”) focused performs better. In other words
don’t make messaging about you, make it about them.
Diligent testing, optimization of offers, calls-to-action
and links/buttons, as well as optimizing messages for
individual screens all positively impacted CTRs. Email
marketers embraced responsive and scalable design,
enabling email readers on any device to click easier this
year than in previous years.
Average CTRs are healthy but there are significant
variances between marketers. The 2013 Epsilon Trends
and Benchmarks Report states that the average CTR in
the USA was 4.5% (Q3 2013).
Like Open Rates, it should be noted that comparing
CTR benchmarks can be difficult because, according to
Marketing Sherpa, only 39% of email marketers in the
United States use the correct methodology for calculating
CTR which is: CTR% = (total clicks/total delivered).
SECTION 4:
List Quality
and Hygiene
Marketers are getting better at list hygiene and, as a result, list issues are nominal. Marketers who properly manage
their lists have low unsubscribe rates (below 0.2% of messages delivered) and complaints are a mere fraction of
that. In 2013, the combined soft and hard Bounce Rate is low (less than 1.6% of all messages delivered). This is the
lowest we’ve recorded in the past five years. In fact, Bounce Rates have decreased by almost half since 2009. It is very
important, especially for high frequency senders, to closely monitor the Bounce Rates on each campaign as well as on
monthly basis. For example, a 2.5% Bounce Rate over a 12 month period is respectable, but if each campaign had this
rate the list erosion would be exponential and marketers should investigate into why this is happening.
7
© 2014 Inbox Marketer Corporation

8. Bounce Rates Declined
The drop in Bounce Rates is a good indication that email
marketers over the past few years have taken a more
diligent approach to list hygiene, as well as implementing
content strategy best practices. This is important for
marketers to commit to as it ensures that they
maintain a good sender reputation and relevance
with their subscribers.
SECTION 5:
List Churn Metrics
There are also other small but equally important list quality measures that email marketers should closely monitor
because, if they get too high, they can negatively affect sender reputation and deliverability. These list quality measures
include Hard Bounces, Unsubscribes and Complaints.
Hard Bounces
Unsubscribes
Complaints
What Are They?
A permanent reason as to why
an email cannot be delivered to a
certain email address and these
records should be flagged and
suppressed immediately.
What Are They?
When users manually opt-out from
receiving all future messaging from
a specific brand or company.
What Are They?
Feedback Loops are tools made
available to email marketers that
enable users to report spam.
Subscribers are most likely to
unsubscribe when:
• They receive impersonal and
irrelevant email.
• They don’t recognize the sender.
• They receive more email than
they expect or want.
By removing subscribers from your
list who don’t want to receive your
emails, you’ll:
• Reduce your complaint rate
• Increase customer satisfaction
• Reduce sender questions and
end-user complaints.
Impact/Fix:
While unsubscribe rates in the
industry are typically low at 0.2%
per mailing, it is an important
metric to pay attention to, as
it provides good insight into
what type of content your
subscribers value.
Impact/Fix:
With lower complaint rates, ISPs
are much more likely to allow your
messages to reach the inboxes of
those subscribers who really do
want to receive them.
Reasons for Hard Bounces:
• The recipient’s email address
does not exist.
• The domain name does not exist.
• The recipient email server has
completely blocked delivery.
Impact/Fix:
Failure to remove hard bounces
from future email campaigns can
severely hurt sender reputation and
one’s ability to get future emails
delivered to the Inbox.
Hard Bounces, Unsubscribes and Complaints all factor into what is known as list churn. List churn is the average
percentage of email address that marketers can expect to lose in a given year. List churn is typically around 30% but
can be reduced by practicing better list hygiene and adhering to industry best practices. Automated Feedback Loops
are key and your deliverability team needs to be diligent in keeping lists updated.
8
© 2014 Inbox Marketer Corporation

9. SECTION 6:
Deliverability
Deliverability is a quality assurance metric that is measured by a third party QA tool like Return Path. Deliverability
measures the destination of the messages and it forecasts the proportion of messages that are delivered to one of
three places: the inbox, the junk folder or “missing”. Deliverability is a critical variable and if done poorly it will lead to
reduced engagement metrics and in turn a lower ROI.
Marketers often get confused with the differences between “delivered” versus “deliverability.” Delivered is defined
as the number of messages that did NOT bounce (# Delivered = # Messages Sent - # Bounced) and this metric
is highlighted on the deployment interface. Email Experience Council (EEC) standards refers to “delivered” as the
“accepted number” of messages which make it directly into a recipient’s inbox. It is also important to track where the
delivered messages end up - that’s where deliverability comes in.
The proportion of messages that make it straight into the inbox is called the Inbox Placement Rate (IPR). In the first
half of 2013, the North American IPR was 86%, “Missing” was 9% and “Bulk” folder deliveries were 5% (Source:
“Email Intelligence Report”, Return Path H1 2013). This is up from 80% the previous year which is a good sign that
email marketers are making real progress toward solving their deliverability challenges. However, 86% is still too low
for legitimate marketers since 14% of messages aren’t reaching the intended target and industry leader typically obtain
IPRs of more than 95%. In addition, losing 14% of messages can have a significant negative impact on your metrics
and marketers should continue to look for ways to engage with their subscribers so that a greater percentage of their
messages make it to the inbox.
Note: according to Return Path the average Global IPR for 2013 was 85%. Leadings ESP’s, like Inbox Marketer, have
ESP’s that are 95%-98% IPR.
Using Benchmarks
Benchmarking is a good exercise for marketers because it helps assess how your programs are performing relative
to the “average”. However, keep in mind that although “average” benchmarks can help gauge email performance,
these benchmarks vary depending on the sender’s brand and reputation, how marketers calculate their metrics, and
the industry sector they are in. Inbox Marketer suggests calculating your own “weighted” benchmarks using a crosssection of sources and not against the general standard. Find the leaders in your sector throughout the world and also
look outside your industry. Use these benchmarks to gauge your organization’s performance.
Observations from eLeaders
The divide between “best-in-class” and “rest-in-class” marketers is widening. Email leaders are typically more
disciplined and do more planning, segmentation and targeting. Campaigns should not be intermittent and rushed.
Email is an opportunity for a two way dialogue and too many marketers miss the opportunity to gather information
from their subscribers. Email is more than just a timely touch point and email leaders craft their campaigns into
different streams and ensure they deliver the best customer experience possible. Leaders prioritize the key “journeys”
for their industry and this enhances customer satisfaction and revenue growth (source: McKinsey & Company).
9
© 2014 Inbox Marketer Corporation

10. In the next year, data will be where smart marketers focus. There is more real-time data now than ever before and it’s
never been easier or quicker to get to it. It’s literally in the palm of our hands. However, this availability and pure mass
of data can be overwhelming. Marketers can fall into the dangers of trying to do too much, measuring the wrong things
and making incorrect assumptions based on correlations they’ve “found”. Marketers don’t only need to focus on their
metrics; they also need to THINK about the “so what?” and “now what?” of their campaigns and strategies. It’s not
as simple as it sounds, but it’s a critical point that too many marketers are missing in this age of Big Data. Begin with
analyzing your data, then sit back for a moment and think “so what?”
When the “so what?” is known, then you can apply these insights and start the “now what?” The “now what?” can be
something easy and quick (change the subject line, amend the frequency of the message) or it can be more tough and
longer-term (our strategy isn’t working, our product needs an update). Asking yourself those questions is what brings
the art into marketing. When the two are blended together, amazing campaigns and results are sure to follow.
A Tip for Today’s Email Marketer
from Geoff Linton, President
Email marketers are under enormous pressure. There is pressure to grow lists, pressure to send more messages,
pressure to put together more targeted offers, pressure to increase ROI… it goes on and on. All of this pressure can
be blinding and, in fact, it is blinding many email marketers from real, relatively simple opportunities that are rich with
ROI. Take a deep breath, and a step back. There is low-hanging fruit all around. Start with a Welcome Program or a Best
Customer-targeted program. If you’re in retail, create a Next Best Product component to your email program. Start
somewhere and don’t be one of the email marketers that gets swept up in “just keeping up”.
Geoff Linton President, Inbox Marketer
Geoff Linton is President and co-founder of Inbox Marketer Corp. and a direct marketing expert
with more than 20 years of applied experience in both client and agency roles. His experience
spans many industrial sectors, including financial services, telecommunications, consumer
packaged goods, technology, manufacturing and entrepreneurial businesses. Previously Geoff
was Associate Director for the Air Miles program where he spearheaded major launches and
was actively involved in targeted marketing initiatives and customer/campaign measurement.
Geoff Linton holds both a P.Eng and MBA from Queens University in Canada.
About Inbox Marketer
Inbox Marketer is a digital direct messaging company
that helps organizations use email, mobile, social media and the web to build engaged online
communities of customers and prospects. For more information about Inbox Marketer’s
products and services, please contact us at:
GUELPH OFFICE
381 Woolwich Street
Guelph, Ontario Canada
N1H 3W8
TORONTO OFFICE
1075 Queen St E
Toronto, Ontario Canada
M4M 1K3
877-994-6664 | sales@inboxmarketer.com | @Inbox_Marketer | inboxmarketer.com
10
© 2014 Inbox Marketer Corporation