How to Interpret Open, Click, and Bounce Rates

Email metrics. Only useful if you know how to read 'em!

At Plunk (the best email tool for SaaS companies fyi) we offer these metrics:

  • Open
  • Click
  • Bounce
  • Spam
  • Retention

But what makes an open or click rate high? And what makes a bounce or spam rate low? And what on earth is a retention metric?

All these numbers, statistics, and digits... what do they mean really?

Black Ops came out 14 years ago... let that sink in.

Understanding Open Rate

The open rate is of course the metric that indicates how many people opened your email. If it says 50%, it means half of the audience that received your email opened it. But let me first explain that the open rate is not super reliable...

Open Rate Reliability

Open rates are typically tracked using a tiny, invisible image embedded in the email, known as a tracking pixel. When the email is opened and images are downloaded, the tracking pixel sends a signal back, counting the email as "opened." However, this method faces several limitations:

  • Images Disabled: If a recipient has disabled images in their email client, the tracking pixel won't load, and the open won't be recorded, even if the email is read.
  • Email Previews: Some email clients automatically load images for preview purposes, which can trigger the tracking pixel and falsely inflate open rates, counting emails as opened even if they were only glanced at in the preview pane.
  • Privacy and Security Software: With increasing awareness around privacy, more users and email services are employing software that blocks tracking pixels, leading to underreporting of open rates.

So while an open rate can indicate whether your email subject line and sender name are compelling enough to prompt opens, it doesn't necessarily reflect deeper engagement, such as actually reading the email content.

So as a rule of thumb, I hold a 5% margin either way to get a solid indication. Meaning if the open rate is 50%, it can also be 55% or 45%, give or take.

How to Interpret Open Rate

A high or low open rate means a bunch of things. Let's go over all of them, but remember this: it primarily reflects the effectiveness of your subject lines and the strength of your sender reputation.

Effective Subject Lines

The subject line is often the first thing recipients see, and a compelling one can significantly influence the decision to open an email. A high open rate suggests that your subject lines are resonating well with your audience. This could mean they are:

  • Clear and Concise: Efficiently communicating the value or interest within the email.
  • Personalized: Tailored to the recipient's interests or behaviors, making the email feel more relevant.
  • Urgent or Curious: Creating a sense of urgency or invoking curiosity without resorting to clickbait.

Strong Sender Reputation

If your emails consistently have high open rates, it's a good indicator that your sender reputation is in a healthy state. Recipients recognize your brand or name and associate it with valuable content, making them more likely to open your emails. This trust factor is crucial and suggests:

  • Consistent Quality: Your emails regularly deliver value, whether through insightful content, relevant offers, or engaging stories.
  • Appropriate Frequency: You’ve found a balance in email frequency that keeps subscribers interested without overwhelming them.
  • Good List Hygiene: Maintaining a clean email list by removing inactive subscribers and hard bounces helps improve deliverability and sender reputation.

Timing and Segmentation

A high open rate can also reflect the effectiveness of your email timing and segmentation strategy. Sending emails when your audience is most likely to be checking their inboxes and segmenting your list to tailor the content can significantly impact open rates. This indicates:

  • Optimal Send Times: You’ve identified when your subscribers are most active and likely to engage with your emails.
  • Targeted Content: Your segmentation efforts are paying off, delivering relevant content to specific groups within your audience, thus boosting open rates.

But it's more so for days, not hours, unless you send a lot of emails. Then you have a lot of data points so you can analyze it correctly. Otherwise, there's no point.

What Else to Consider

While a high open rate is a positive sign, it's crucial to delve deeper to understand the full context of your email campaign's performance. Consider the following:

  • Content Relevance: Beyond the open, does the content keep the audience engaged? High open rates paired with low engagement or click-through rates might indicate a disconnect between expectations set by the subject line and the actual content.
  • Action Taken: Are recipients taking the desired action after opening the emails? Whether it's clicking on a link, making a purchase, or filling out a form, the ultimate goal of the email should be considered alongside open rates.
  • Email Software: Is your software super lightweight and optimized like Plunk?
  • Audience Feedback: Collecting direct feedback from your subscribers can provide insights beyond what metrics alone can offer, helping to refine both content and strategy.

At Plunk, we show your overall average open rates across your account, and also individually for your sent campaigns:

This is the average one
Here's an example of a campaign open rate (58%)

More on open rate here. In this article, we checked with our own users what the average open rates were. Here are the results:

Big Senders:
These folks have sent +10,000 emails.
Open rate: 52%.

The Middleweights
Sending 1,000 to 10,000 emails.
Open rate: 55%

The Lightweights
Sending 100 to 1,000 emails.
Open rate: 60%

Interesting, no?

So even if the open rate isn't always tracked correctly, you can still rely on this data. An email with a 60% open rate or a 30% open rate will be delivered or thought of by your audience in a different enough way. 50% and 55%, for example, is probably marginally the same.

How to Interpret Click Rate

A high click rate signifies that recipients are not only interested in your message but are also taking the action you've guided them toward. Here’s how to interpret a high click rate and what it implies for indie hackers and SaaS founders:

Content Relevance and Value

To a degree, a click rate indicates how valuable your content is. It's a bit of a grey statistic as it has influence but there's a lot of guesswork there. In any case, I'm confident in saying it suggests:

  • Targeted Content: You've effectively segmented your audience and tailored your content to meet their specific interests or needs.
  • Quality Information: The information or offers you're providing are compelling enough to prompt recipients to want to learn more or take advantage of them.

Effective Call-to-Action (CTA)

The CTA is crucial in guiding recipients toward the desired action, whether it's visiting a landing page, signing up for a trial, or making a purchase. A high click rate by definition reflects well-crafted and strategically placed CTAs. This could mean:

  • Clear and Concise CTAs: Your CTAs are easy to find, understand, and compelling enough to click on.
  • Visually Appealing Design: The design and placement of your CTAs stand out, making them more noticeable and clickable.
  • Personalization: Personalized CTAs based on the recipient's past behavior or segment can significantly increase click-through rates.

But you can also trick them into clicking and then not following up. Having a big ass button saying "FREE MONEY HERE" and then not giving free money, that's not much use.

Strong Email Design and Layout

The overall design and layout of your email can greatly influence click rates. A high click rate suggests that your email is:

  • Well-Structured: Information is presented clearly and logically, guiding recipients toward the CTA.
  • Engaging Visuals: Use of images, videos, quotes, stickers, buttons, or whatever else that complements the text and encourages clicks.

Trust and Brand Loyalty

Recipients clicking through links in your emails indicate a level of trust in your brand and the content you provide. Open rate does this too! This trust is built over time through:

  • Consistent Quality: Delivering consistently valuable content that meets or exceeds expectations.
  • Transparent and Honest Communication: Being clear about what the recipient can expect upon clicking a link and delivering on that promise.

Here's how to write your email using the AIDA framework. It's tried and tested to get a high engagement rate.

How to Interpret Bounce Rate

Unlike high open and click rates, which signify engagement and interest, a high bounce rate indicates potential issues that could affect your email deliverability and overall campaign effectiveness.

Understanding Bounce Rate

Bounce rate measures the percentage of emails that were not delivered to the recipient's inbox. Bounces are categorized into two types:

  • Hard Bounces: These occur when the email is permanently undeliverable, typically due to invalid email addresses or domain names. High hard bounce rates can severely impact your sender reputation.
  • Soft Bounces: These are temporary delivery failures, often due to a full inbox, server downtime, or overly large email size. While less harmful than hard bounces, consistent soft bounces from the same address might eventually be treated as hard bounces.

Implications of a High Bounce Rate

  1. List Quality Issues: A high bounce rate, especially hard bounces, often points to problems with your email list's quality. It might indicate outdated or incorrectly entered email addresses.
  2. Sender Reputation Damage: Email Service Providers (ESPs) monitor bounce rates when determining sender reputation. A consistently high bounce rate can lead to your emails being flagged as spam or blocked entirely.
  3. Reduced Email Deliverability: As your sender reputation suffers, your overall email deliverability can be negatively impacted, meaning even your legitimate, engaged subscribers may not receive your emails.
  4. Engagement and Performance Impact: High bounce rates can skew your campaign metrics, making it difficult to accurately measure engagement and performance. This can lead to misguided decisions based on incomplete data.

Strategies to Reduce Bounce Rates

Reducing your bounce rate is crucial for maintaining a healthy email marketing strategy. Here are several proactive steps you can take:

  • Regularly Clean Your Email List: Remove invalid, outdated, or unengaged email addresses. Consider using email verification tools to validate addresses before adding them to your list.
  • Implement Double Opt-In: This process requires new subscribers to confirm their email address before being added to your list, significantly reducing the chance of invalid addresses.
  • Monitor Email List Growth Sources: Ensure that the methods you're using to grow your list are attracting quality subscribers who provide accurate email addresses.
  • Segment and Personalize Emails: Sending relevant, targeted content reduces the likelihood of subscribers marking your emails as spam, which indirectly affects bounce rates.
  • Adjust Email Frequency: Over-mailing can lead to list fatigue and increased unsubscriptions or spam complaints, which in turn can affect bounce rates due to ISPs blocking your sends.

At Plunk, we show the average bounce rate across your account:

As you can see here

More on bounce rates in this dedicated article.

How to Interpret Spam Rate

Now this is a big one. If your spam rate is high, you need to change a few things.

The spam rate measures the percentage of your emails that recipients mark as spam or junk. While ideally, this rate should be as close to zero as possible, understanding and addressing even a minimal spam rate is crucial for maintaining the health and effectiveness of your email campaigns.

Of course, if you have 100k contacts and a spam rate of like 0,02%, that's just going to happen no matter what.

If you have 200 people and a spam rate of 1% or 2%, you need to seriously change how/what/who your sending.

What a High Spam Rate Indicates

  1. Content Relevance Issues: Your emails may not be meeting the expectations of your audience or are perceived as irrelevant or unsolicited. This mismatch between subscriber expectations and email content can prompt recipients to mark emails as spam.
  2. Inadequate Segmentation: Failing to segment your audience effectively can lead to sending generic messages that don't resonate with specific subscriber groups, increasing the likelihood of spam complaints.
  3. Poor List Acquisition Practices: Acquiring email addresses through less reputable means, such as purchasing lists or adding people without their explicit consent, can lead to high spam rates as recipients may not recognize your brand or remember subscribing to your list.
  4. Frequency Issues: Sending emails too frequently can overwhelm subscribers, leading to higher spam complaints. Conversely, infrequent communication can make recipients forget they subscribed, also resulting in spam flags.

Strategies to Reduce Spam Rates

Reducing your spam rate is essential for ensuring the long-term success of your email marketing efforts. Here are several strategies to achieve this:

  • Ensure Clear Opt-in Processes: Use a double opt-in process to verify that subscribers genuinely want to receive emails from you, reducing the likelihood of spam complaints.
  • Maintain List Hygiene: Regularly clean your email list to remove inactive subscribers who are more likely to mark your emails as spam.
  • Segment and Personalize: Tailor your emails to fit the interests and needs of your audience segments. Personalized emails are less likely to be perceived as spam.
  • Manage Sending Frequency: Find the right balance in your email frequency, based on subscriber preferences and engagement data, to avoid overwhelming or alienating your audience.
  • Provide Clear Unsubscribe Options: Make it easy for subscribers to opt-out of your emails. A clear, simple unsubscribe process is preferable to having your emails marked as spam.
  • Educate Your Subscribers: Encourage new subscribers to whitelist your email address. This not only improves deliverability but also reinforces the subscriber's decision to receive emails from you.
  • Monitor Feedback Loops: Set up feedback loops with major ISPs to get notified when recipients mark your emails as spam, allowing you to remove them from your list promptly and avoid further complaints.

Similar to bounce rate, at Plunk we show the overall spam rate:

Ours is 0% ... yay :)

How to Interpret Retention Rate

Retention rate is less common in email marketing metrics, but at Plunk, it refers to the percentage of total users who remain subscribed to your email list over a specific period, taking into account those who have unsubscribed.

This metric provides a clear picture of how effectively your email strategy maintains its subscriber base, crucial for assessing long-term engagement and the overall health of your email marketing efforts.

Understanding Retention Rate at Plunk

It's easy! In the analytics tab, we just show it to you :)

Here, 88% of the total ever contacts are still subscribed. 12% are not.

Why Retention Rate Matters

A high retention rate indicates that your content is engaging, relevant, and valuable enough to keep subscribers interested in staying on your list. It suggests that your email campaigns are successful in building and maintaining a loyal audience base, which is essential for sustained business growth and effective communication.

Of course, if you run a SaaS and people unsubscribe from your tool as a whole, they're probably also on your unsubscribe list for emails. So if your churn is high, so will your retention rate.

Sometimes, people unsubscribing is not a bad thing. It's natural. If they don't like it anymore, that's fine. Even better actually that they've unsubscribed! If they wouldn't your open rates would go down.

We also show this cool graph to see your contact totals go up (hopefully):

Our contact graph only goes up baby!

So there we are! This is what the numbers mean and how to read them.

Open and click rates shine a light on the appeal of your subject lines and the relevance of your content, driving home the importance of crafting messages that resonate with your audience. Conversely, bounce and spam rates raise red flags, signaling issues with list quality and content alignment that could undermine your campaigns. Addressing these concerns is crucial for maintaining a healthy sender reputation and ensuring your emails reach their intended targets.

Retention rate, while less commonly emphasized, offers a powerful glimpse into the long-term engagement of your subscriber base, highlighting the effectiveness of your ongoing communication efforts.

Got a SaaS project?
Take a look at our humble but extremely capable email tool :)

Carlo D'Agnolo
CarloFounder & Head of Growth at Plunk