Email Churn Rate Explained: What It Is, How to Calculate It, and How to Improve

What is the email churn rate?

Email churn rate is an email marketing metric that shows the percentage of people who unsubscribed from your newsletter or were otherwise removed from your mailing list over a certain period. 

Whether it is a week, month, year, or any other period, you can track and calculate your email churn rate to see if the content of your email marketing campaigns is relevant for your subscribers or you should work on improving it.

Types of email churn

There are two types of email churn: transparent churn and opaque churn. Here’s what makes them different:

How to calculate email churn rate

Just like with other important metrics, email marketing services usually provide email analytics tools that generate churn rate reports for you to track. However, you can calculate your email churn rate yourself using the formula below:

Let’s say, you want to calculate your churn rate in a month. If at the beginning of the month you had 1,000 subscribers, and had 930 by the end, your email churn rate equals:

(1000 – 930) / 1000 × 100 = 7%

On average, according to several sources, the churn rate for businesses is about 30% yearly. Though, the average transparent churn rate is typically higher than the opaque churn rate.

What makes email churn rate important?

The email churn rate indicates how your email marketing campaigns perform. Here are some other reasons why you should track your email churn rate:

• It helps you control your resources. You know how much money can be spent on email marketing campaigns. So, to make sure your money won’t go to waste and your return on investment (ROI) is high, monitor your email churn rate and check the efficiency of your campaigns.
• It helps your sender reputation. High churn rate might be a sign of your emails ending up in the spam folder. So, monitoring your churn rate can prevent it from happening and keep a good sender reputation.
• It helps you keep good customer retention. Low email churn rate can also serve as a sign of a good customer retention, meaning that the content of your emails is relevant and resonates with your audience.

Main causes of a high email churn

To reduce your email churn rate, identify the reasons why it might be high. Here are some of the typical causes of a high email churn rate:

• Your content is irrelevant or of low value. If your emails provide content that does not bring any value to your subscribers, your audience might not see a point in being subscribed to your newsletter.
• Your emails are too frequent. As tempting as it might be, we don’t recommend sending newsletters too often. Your subscribers may get overwhelmed and annoyed and want to opt out from you.
• Your email list has many inactive subscribers. If someone provides the wrong email address or stops using the one provided, it will negatively affect your mailing list and contribute to high opaque churn.
• Your emails are not responsive. There are many various devices and email clients people use for opening their emails. According to Litmus, 47.70% of users use Apple devices, while 35.20% prefer Gmail. Other popular clients include Outlook, Yahoo Mail, Google Android, and others. These include mobile versions too. Having said that, it is highly important to use responsive email templates, so that your emails look good across various devices. 
• Your emails end up in the spam folder. There might be multiple reasons for that, including low IP or domain reputation, bad design choice, the absence of an unsubscribe link, and more. So, monitor and track your metrics regularly to timely fix this issue.

How to minimize email subscriber churn

As you’ve learned possible reasons for a high churn rate, it’s time to learn how to keep it as low as possible. Here, we’ve gathered a list of the best tips to reduce your churn rate:

• Provide high-value content. Relevant and engaging content is what makes your customers keep being subscribed to you. Think about your own inbox and the marketing newsletters you are subscribed to. What makes you interested in receiving their content? It might be regular discounts, educational content, customer life stories, exclusive sales, or other valuable content.

In its email, Pho makes an exclusive offer for its subscribers. This campaign can promote the new menu and show appreciation to the brand’s subscribers at the same time. The email has a clear value and most likely will contribute to the retention rate, as the subscribers will look forward to other offers by the brand.

• Send personalized and segmented emails. Segmentation is a great way to make your emails more engaging and relevant for your subscribers. You can segment your audience based on their location, purchase history, age, or other relevant data to send personalized emails to each group. 

Let’s say, you enjoy hiking and often purchase necessary gear. Imagine you receive an email offering a selection of hiking boots with a discount. Would you engage with this email? Even if you are not planning on buying a new pair, you would probably still open and take a look at the offer. Now, imagine you regularly receive emails offering something of your particular interest. This would probably make you never consider unsubscribing from this newsletter.

The email below by FashionNova is a great example of personalized content. The brand offered a selection of items the subscriber was interested in and provided a promo code making the offer more desirable. Receiving this email the subscriber will consider taking the offer and look forward to other emails by the brand.

• Optimize email frequency. Since you don’t want to overwhelm your subscribers by sending your emails too often, it is best to identify the optimal email frequency. 

Since it may depend on various factors, such as your industry or your personal marketing goals, you can refer to your industry’s benchmarks or analyze your engagement metrics. We also recommend you plan your email campaigns beforehand to only send the campaigns with the most engagement potential. You can use an email marketing automation tool for this purpose.

• Regularly clean and update your email list. It is necessary in case some recipients don’t use the provided email addresses anymore, provide incorrect email addresses or bots. So, scan your mailing list to see if there are any recipients like this to delete them and improve your bounce rate.
• Offer subscription preferences. This way, your subscribers can choose their preferred email frequency and the type of emails they want to receive. If your recipients are the ones who control their subscription, there is a higher chance they will stay with you longer.

In this retention email by Cuisinart, the brand targets a recipient who no longer wants to receive the brand’s campaigns. Rather than just saying bye to the unsubscriber,  Cuisinart offers them to customize their preferences. By doing that, the brand shows consideration and appreciation. The email also features a fun wordplay and images making it more appealing.

• Gather subscriber feedback. Another way to decrease your email churn rate is to ask your subscribers whether they like your content, what type of emails they wish to receive, or other questions that will help you optimize your emails. You can also offer something in return, such as a promo code, in-store credit, a discount, or other freebies.

In the email below, Lyft offers an Amazon gift card for participating in its survey. This offer would most likely not go unnoticed by the recipients, which increases engagement and makes the audience look forward to other valuable offers from the brand. 

• Try re-engagement campaigns. It will be effective if you want to reduce a high opaque churn rate and increase the retention rate. 

There are multiple re-engagement email options, such as exclusive discounts, promo codes, or other offers. You may also ask your customers for their feedback, ask a question they would want to answer, show them your consideration by checking on them, or show inactive subscribers what benefits they are missing.

This re-engagement email by Specialized Bicycle Components is not information-heavy but rather simple and straight to the point. The brand reminds the subscriber of the item they’ve been interested in and offers a discount increasing the chance of placing an order. Although the recipient may not do so, there is a high chance of engagement with the email.

Final thoughts

Monitoring your email churn rate can bring multiple benefits to your business. Not only does it help with customer retention, sender reputation, and return on investment, but makes it easier to track the effectiveness of your marketing campaigns. 

Don’t worry if your email churn rate is high though. Here’s what you can do to reduce it:

• Make your content valuable for your subscribers.
• Segment your mailing list to reduce bounces and spam complaints.
• Don’t send emails too often.
• Clean your mailing list regularly.
• Let your subscribers set their preferences.
• Ask your audience for feedback.
• Use re-engagement marketing campaigns.

We hope our recommendations can help you keep your email churn rate low and make the best of your marketing campaigns.