How do ESPs track delivery and bounce events?

Shared IP addresses pool your sending with other ESP customers, meaning your reputation is partially determined by their behavior. If neighbors on your shared IP send spam or generate complaints, your deliverability suffers. Conversely, if you're a lower-volume sender, shared IPs provide established reputation you couldn't build alone. ESPs typically segment shared IP pools by sender quality to protect good senders from bad ones.

Dedicated IP addresses are assigned exclusively to your sending, making your reputation entirely your own responsibility. This provides control because others can't damage your reputation, but it also means you must build and maintain that reputation yourself. Dedicated IPs require sufficient volume to establish credibility, typically at least 100,000 emails monthly, and careful warming to build sender reputation.

The choice depends on your sending volume and consistency. Low-volume senders benefit from shared IPs because they borrow established reputation. High-volume senders with consistent practices benefit from dedicated IPs because they control their destiny. Some senders use hybrid approaches with dedicated IPs for marketing and shared pools for transactional email. IP strategy matters more than many marketers realize; discuss options with your ESP based on your specific sending patterns.