How to Forecast Your Email & SMS Revenue

Why Forecast at All?

A forecast sets expectations and justifies the spend.

Without one, you are guessing.

With one, you can point to a number and decide if the work is worth it.

We took one brand from $131k to $2.4M in monthly revenue in 90 days. When they came to us, email drove about $31k of that $131k, retention was 23.9% of revenue, and they were doing NOTHING with SMS. After 90 days they were pulling $751k from Klaviyo and another $539k from their SMS software. That is a 236x return on what they paid us.

None of that was a traffic problem or a product problem. It was a backend execution problem. The forecast is how you spot that gap before you spend a dollar closing it.

Here is the video version:

The Benchmark You Are Aiming For

Healthy DTC brands drive roughly 25-35% of total revenue from email and SMS combined.

Most brands sit well below that. Often under 15%. Sometimes under 10%.

That gap is your opportunity. If you are at 8% and your peers are at 30%, you are leaving a large slice of revenue on the table.

The brand above sat at 23.9% and looked fine from the outside. Premium products, great margins, founders who had scaled before. But their flows were basically stuck in 2010. Besides a welcome flow, their abandoned cart, abandoned checkout, and post-purchase were doing almost nothing. They ran six campaigns a MONTH. Everything they needed was already there. The revenue was just trapped behind bad execution.

The forecast below turns that gap into a dollar figure.

There is a second reason this matters, and most people miss it. Retention does not just make money on its own. It makes your paid ads more profitable. Every customer you acquire for $50 on Facebook is worth $200, $300, sometimes $500 once email and SMS get involved. Higher lifetime value means you can spend more to acquire, which means you beat competitors who are stuck breaking even on the first order.

SMS ramps, it does not switch on. On the brand above, SMS went from $28k in month one, to $140k in month two, to $539k in month three. Model it as a curve, not a flat number you hit day one.

The Gap Model

The math is simple. It is an estimate, not a promise. Four steps.

The formula: (Target share minus Current share) times Monthly revenue = Added monthly revenue.

A Worked Example

Say your store does $500,000 a month and email plus SMS drives 8% of that today. You set a target of 30%.

The gap is 22 percentage points. On $500,000, that is $110,000 more per month, or about $1.32M a year.

Treat it as a ceiling you build toward over months, not a switch you flip.

The Levers That Close the Gap

Work them in order. Each one hits diminishing returns before the next one starts to matter.

Flows first, because they convert intent you already have. List growth next, because more subscribers means more people to send to. Then cadence and segmentation, to earn more from the list you have.

What the Flows Actually Add

Flows are the clearest line item in any forecast because they run on autopilot. Get them right once and they send over and over, so small tweaks compound.

We build 10 to 12 flows per client covering every stage of the customer journey: welcome, abandoned cart, abandoned checkout, browse abandonment, site abandonment, post-purchase, VIP, and a few nice-to-haves like birthday.

Here is what the flows added for the brand above, per month, in new revenue that was left on the table before:

The four abandonment flows, a strong post-purchase sequence, and your welcome flows are the big drivers. That post-purchase flow alone was $42k a month, from a brand that was doing no upsells, no cross-sells, and not even asking for reviews.

If you do not have these built, that is not a strategy gap. It is revenue on the floor.

Sanity-Check Against List Size

A forecast is only real if your list can support it.

Before you trust the number, check it against send volume.

If your model says $110,000 more per month but you only have 15,000 subscribers, the math will not hold.

Grow the list or lower the target. One or the other.

Common Mistakes

1. Assuming overnight results. This is a 6 to 12 month build, not a first-month number.
2. Ignoring list size limits. A target you cannot send to is a fantasy, not a forecast.
3. Double counting attribution. Email and SMS often touch the same order, so do not count that revenue twice.
4. Modeling SMS as a separate 30%. SMS adds a few points on top of email. It does not repeat the whole benchmark.
5. Forecasting off a peak month. Use a typical month so seasonality does not inflate the number.
6. Treating the estimate as a promise. Call it an estimate, then revisit it every quarter with real data.

Get Expert Help

Our team builds these forecasts from your actual store data, then executes the flows, list growth, and campaign strategy to close the gap. We take full ownership of the channel: content calendars, offers, flows, AB testing, and daily sends. You drive traffic, we bring in the sales on the backend.

That is how we added 10 to 35% to monthly revenue for brands at every level, and a lot more for brands like the one above. You get a clear target and a plan to hit it.

No guesswork.

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