Content
Open Rate
The percentage of openings of the letters you sent. You need to count them to assess how interested your subscribers are in reading your newsletter. There is a simple formula for calculating the Open Rate: divide the number of opened letters by the total number of sent letters and multiply by 100%.
If you sent 250 emails and 24 users opened them, then the Open Rate would be 9.6%.
Open Rate Calculation Formula
Churn Rate
An indicator that shows the outflow of customers from ivory coast phone number material your business. You may have growing indicators for the total number of customers, but if you look deeper, there will be a minus. Why is that? We will explain with an example.
Formula for calculating Churn Rate
At the beginning of the month, 500 clients use your product, at the end of the month, there are 515 clients. The growth seems obvious, but let's add here the indicator of 25 new clients.
Churn Rate is: (500+25-515)/500*100% = 2%
This month you lost 2% of your users, although their total number increased.
LTV (Lifetime Value)
We determine how much profit 1 client brings you over the entire period. It is important that the costs of attracting a user are lower than the profit. Otherwise, the business will go "into the minus". We have a useful article on how to open an online store for one product , for which the LTV calculation formula will be useful.
How to count:
Multiplying Lifetime by ARPU. Let's explain.
Lifetime - shows how long the user remains active.
ARPU is the average revenue per user per month. It's easy to calculate: take the total revenue for the period and divide by the number of users for the same time. Now let's look at an example.
Formula to find out LTV
Let's start by calculating ARPU. You have an online store where you sell car tires. Last month, 75 customers placed an order for $23,000.
APRU = $23,000 / 75 = $306 average profit per client.
Now we calculate LTV, for this we need to know Lifetime. You know that customers buy tires from you 4 times during the entire period - this is the Lifetime indicator. We bring everything together:
LTV = 4 * $306 = $1224
This means that our client’s LTV is $1224 – the amount that he can bring in over the entire period of working with your online store.
Why calculate LTV:
Identify your most loyal or profitable customers. In fact, these are customers who regularly buy your products or use your services. The more such customers you have, the more profitable your business will be.
Optimize work. It may be that most customers buy from you once and never come back. This means they don't like something and you need to make adjustments. For example, a customer may be put off by the work of sales managers, long delivery times, slow service, the product doesn't bring enough value, etc.
Analyze behavior. Look at the customers with the highest LTV and identify their behavior pattern. Understand why they buy the most, how often, and under what circumstances.
ROMI
A coefficient that calculates the return on investment in marketing: advertising, SEO, mailings, work with bloggers. The main goal of ROMI is to show which marketing expenses bring more profit.
