How To Calculate The Value of an Email Address

Everyone in the restaurant industry knows an email address is worth something. Yet when you ask a marketing director how much they are worth, you almost never get a solid answer. NO MORE. Here is how to calculate the value of your email address (protip - download a calculator to do it for you here).

The variables (pieces of information) you’ll need:

  • Average ticket ($35)

  • Average Eblast Open Rate (24%)

  • Average Click Rate (20%)

  • Average Landing Page Conversion Rate (50%)

  • Average Redemption Rate (25%)

  • Number of email blasts sent in a year (12)

  • Average participation rate of any given consumer (25%)

Knowing the value of an email address can help you predict revenue and efficiently acquire more email addresses.

Knowing the value of an email address can help you predict revenue and efficiently acquire more email addresses.

First, let’s calculate the value of an email address by assessing the revenue impact from a single eBlast. Here, we’ll need our average ticket, your open rate, click rate, landing page conversion rate and redemption rate.

Multiply:

your average ticket ($35) * your open rate (24%) * your click rate (20%) * your landing page * conversion rate (50%) * your redemption rate (25%) = Expected revenue per email per blast ($.21).

The answer is the expected revenue per email address per email blast. In our example case, the answer is $.21. 

Now, we have to calculate the annual value of that email address per blast. To do that, we need to discover our participation coefficient…the expected number of eblasts that will influence a random person in your database to spend money. To do that, multiply:

Number of email blasts sent in a year (12) * Average participation rate (1/4) = Participation Coefficient (3)

In our example, your participation coefficient is 3. Which means that any given email address is going to spend money as a result of 3/12 emails you send over the year. To calculate the annual value of an email address, we multiply:

Participation coefficient (3) * Value per email address per blast ($.21) = Annual value of an email address ($.63).

Or, just download our free Email Value Calculator and save yourself a ton of time.

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