Is your email list dying a slow and steady death? You may not know it, but each year 50% of your subscribers may be leaving, disappearing and hibernating.

Everybody talks about click, open and conversion rates when measuring an email message's success or failure. For many companies though, their email program’s success is ultimately determined by the quality and size of their list. So we've come up with a new metric that's a critical measure of your ability to grow your list.

We call it the "email list hurdle rate", and it measures the loss rate from your list that you need to overcome to grow your list. You need to know your list's hurdle rate, because it will tell you how many new subscribers you will need to attract, both to replace the ones who leave and to grow your list.

Another hurdle to overcome besides list churn is list fatigue, caused by once enthusiastic subscribers deciding to take a Corona break attitude with your emails.

List Churn

This is the number of subscribers who leave your list over a certain period, usually measured monthly or annually. If you have 10,000 addresses on your list, and 3,000 drop out in a year (250 a month), then your annual churn rate is 30% and monthly is 2.5%.

That may sound like a lot of loss, but research by companies that specialize in email change-of-address services say it's a pretty typical annual turnover, especially on mailing lists with high percentages of free email accounts such as Hotmail and Yahoo!

What accounts for churn? A small percentage, typically about 2% to 3% annually, comes from people who unsubscribe from your list. (Don't get complacent if your unsubscribe rate is less than this; see why in the next section.)

Another 20% to 30% or more of addresses may be lost each year to hard bounces.  Subscribers either entered their addresses incorrectly when opting in or the address is no longer valid, causing the bounce.

Lastly, are spam complaints. Everyone gets them, even the most legitimate of permission marketers. It is obviously mandatory to unsubscribe these complaint filers from your list and then include them in your lost subscriber calculations.

Calculating Your List Hurdle Rate

You can figure your monthly churn or loss rate by monitoring your email performance reports. To determine your monthly or annual number of lost subscribers, add up your hard bounces, unsubscribes and spam complaints. Then divide the total number of lost subscribers by your current list size to find your hurdle rate.

Consider, for example, that you have a list of 5,500 that you want to grow to 10,000 in one year.  If 51 subscribers are lost in month one for a monthly hurdle rate of 0.93%, you would need to add 5,342 new subscribers over the 12 months, quite a bit more than the 4,500 needed if no subscribers were lost.

And this example is from a very small list. Using an annual hurdle rate of about 33% you would need nearly 200,000 new subscribers to grow your list by 100,000 to 350,000 from 250,000. Similarly, you would need more than 560,000 new subscribers to grow your list by 200,000 to 1,200,000 from 1,000,000 using a 33% hurdle rate.

Ouch. As you can see, understanding your list growth hurdle rate can be extremely important in your annual planning process and forecasts of revenues or subscribers. Not taking your hurdle rate into consideration and you will have a lot of explaining to do with your boss when you fall well short of your list growth goal.

Now, check your new subscriber numbers. Are they keeping up with and surpassing your churn rate? How much progress are you actually making each month compared to your hurdle rate? Check out the articles at the end of this article for tips and suggestions on how to reduce bounces and spam complaints, and grow your list.

List Fatigue

Unlike list churn, fatigue is much harder to grasp, because it generally requires a little more work.

Basically, list fatigue comes from members who have been on your list for awhile but have essentially disengaged and become inactive. They haven't actually unsubscribed, but they've simply stopped opening and engaging with your emails. (For more on “inactives”, see the article 12 Tips To Re-Engage Your "Inactive" Recipients)

That's why the unsubscribe rate is not a reliable indicator of how your members feel about your email. Studies have shown people say they're more likely to delete email unopened or hit their Report Spam buttons and hope that makes you go away.

Many factors can bring on list fatigue, but the most common causes are over mailing, irrelevant offers and newsletter content that doesn't reflect readers' interests.

You can figure list fatigue basically by determining the percentage of inactive subscribers: those that haven't opened or clicked on a single email message over a specific time period. We like to use 6 months or 10 messages as a minimum period to gauge inactivity, but a different time span may be more appropriate for your program. Again, see 12 Tips To Re-Engage Your "Inactive" Recipients for detailed information and steps on how to calculate your inactive percentage, and move to re-activate those sleeper subscribers.

In our experience, 30%-50% of a typical list may be inactive. Yes, a third to a half of your subscribers are receiving your emails, but for a variety of reasons are choosing not to open AND not to unsubscribe. Some of these subscribers may not actually be seeing your emails because they have been blocked, filtered or are in their bulk folder, but most are likely just inactive. We don't have solid research to back this up, but we estimate that each month perhaps 1% to 2% or more of your list is going inactive.

So now, perhaps that 30% open rate makes sense to you as the other 70% have become clearer. Perhaps 40% are inactive, maybe another 10% or so are being blocked or filtered and the other 20% are active, but were on vacation, busy, or not motivated by your subject line and just didn't open your email.

While many marketers like to blame factors such as spam filters and disabled images for declining open rates, the plain fact is that unless you are constantly adding new subscribers and re-energizing old ones, your list is simply getting tired. It is critical that you establish plans and obtain the resources needed to achieve your target list growth rates and slow or reduce your ratio of inactive subscribers.

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