CTR, or clickthrough rate, is a pretty simple calculation of how many people clicked on an ad (clicks) divided by the number of times the ad was shown (impressions). It’s also one of the most common metrics in digital advertising. Why? Because measuring the proportion of viewers who click on an ad is a key way to know whether the ad is effective, whether it resonates with the target audience, and whether it is driving traffic to your website.
Ad Clicks ÷ Ad Impressions = Clickthrough Rate
Anyone who’s ever even dipped a toe in the performance marketing ocean has heard of CTR. But what is it and why does it matter? Let’s explore.
So, what is CTR?
As one of the classic performance marketing metrics, you’re going to be bumping into CTR a lot. But CTR – AKA clickthrough rate – is much more than just a metric. In fact, because advertisers typically pay publishers for every ad click, CTR affects the bottom line for both sides in the advertising partnership.
So, in light of the importance of CTR in your everyday PPC activities, we’ve summarized 7 key facts about clickthrough rate. Just by internalizing these points, you’ll go a long way to understanding how CTR works, and what you can do about your CTR to make it better than it is today.
Here are 7 things you really should know about your CTR:
- Why is CTR a key metric?
- What’s a “good” CTR?
- Does CTR affect your SEO?
- Better ad copy can go a long way to boosting your CTR
- Keywords count – a lot
- Testing is the way to success
- Know your audience
Why is CTR a key metric?
When an ad has a high clickthrough rate, it means that many people who see the ad are choosing to interact with it – so they must find it engaging. This matters for several reasons. First, high CTR drives interest, engagement, traffic, and possible conversions for your business. When your ad has good CTR, then this shows Google that it is high quality and interesting to audiences, and your Quality Score will improve. High CTR also correlates with a lower cost per click and higher number of impressions, leading to more engagement and an even higher Quality Score. In short, good CTR has a ripple effect, creating a whole chain of positive results.
But taken together with your other KPIs, CTR is even more powerful. Remember, CTR is a measure of how many people clicked on your ad. It does not reflect the conversion rate on your landing page, such as the number of people who completed a form, or contacted your sales rep. Taken by itself, the CTR can tell you how appealing your ad is by how many clicks it generates – but if you are aiming for conversions, not just viewers, then the CTR alone won’t tell you a lot.
For example, if an ad has a very high CTR yet low conversion rate, it is likely a sign that the audience you’re reaching is too broad, or perhaps the ad message is not properly aligned with the landing page. Use your CTR together with other metrics to give you a complete picture.
What’s a “good” CTR? It depends…
What’s considered to be a good CTR varies greatly, and depends upon the platform too. For Google ads, the average CTR currently stands at 3.17%. However, for Facebook and Instagram ads, the average CTR is around 1%. Overall, display ads get lower CTRs than native ads – for display, the average is around 0.05% while for native ads, the average is around 0.2%.
Another variable is the type of industry you are serving. For search ads, for example, Arts & Entertainment gets the highest CTR by far on search ads – 10.67% – while Business Services achieve an average of just 4.72% CTR.
Besides keeping track of your industry’s average, remember, the toughest competitor you face is yourself. Try to beat your own record, and focus on achieving a higher CTR in your next campaign than your last.
Does CTR affect your SEO?
Your ranking on search engines is partly based on how popular your website is, and popularity is measured by page views. The more clicks your page gets – or, in other words, the higher your CTR – then the more valuable the search engine deems it to be. So your page will naturally rank higher. Conclusion? Higher CTR equals better SEO – and good SEO means higher CTR too. Make sure to optimize your web pages with relevant keywords and snippet data, so you can boost your SERP results when users search in your niche.
It’s all about quality and relevance. Search engines study engagement to determine which pages are best suited to the search query. So make your website the ‘party that everyone wants to attend’, and improve your CTR to boost your SEO.
Better ad copy can go a long way to boosting your CTR
Unless it’s one of the 50% (!) of clicks that are accidental, a person clicks on your ad because they find it engaging or interesting. High CTR ads succeed in ‘talking’ to the target audience. Conversely, if your ad has a low CTR, you may be able to improve it by working on the ad copy, message, or design, to make it more appealing to your audience. Take a look at your higher-performing ads. What words or phrases do you use? What does the call to action sound like? What stands out about the design? Try to replicate the things that make your ads work, so you can get even better results.
Check out these best practices for high-performing ad headlines and images, based on Outbrain network data.
Keywords count – a lot
It’s not just copy that has to be convincing. You’ve got to work on your keywords too. And here’s the trick: be specific. Now for an example – suppose you’re a baker targeting people searching for cupcake catering for events. The keyword ‘cupcake’ is very broad, but if you narrow your keyword to ‘special cupcakes catering’, you’ll reach a far more targeted audience. If you narrow it down even more to ‘special cupcake catering in Bristol’ you’ll get even more focused results. By choosing a focused keyword, you may be sacrificing the number of impressions and clicks, but you’ll likely achieve a higher CTR. This is because your ad is attracting more qualified traffic to begin with. In a nutshell, don’t go keyword crazy – it’s much more CTR-smart to focus on one strong primary keyword or long-tail keyword.
Testing is the way to success
PPC is all about figuring out what works and what doesn’t, and that means you need to test, test, test! It’s really important to use A/B testing on your ads so you can understand what you need to do to increase your CTR. It might be something as seemingly small as tweaking punctuation, using numbers instead of words, or the way you’ve phrased your call to action. Or perhaps you need an image that is more emotionally resonant. Whatever it is, as soon as your test results are conclusive, make sure to implement the necessary optimizations to your ads. Then begin the cycle of publishing and testing them again. With a bit of sweat and lots of perseverance, you can optimize your campaigns and send your CTR soaring.
Know your audience
In marketing, no matter which tactic you want to use, or what kind of ad or campaign you want to run, there is something you absolutely must do first: get to know your audience. The same is true if you want to improve your CTR.
This is where buyer personas come into the picture. Creating personas for your typical target audience is a great way to get inside their heads and understand their pain points. Think about how they would describe the service or product they’re looking for. Learn their language and use their jargon. Dismiss the things that might seem important to you, but just aren’t to them. This is not as easy as it sounds! It involves deep understanding of your business, complex number crunching and analysis – but most importantly, it means actually talking to your customers. Each interaction you have with your customers is a chance to find out more about them. Get to know what your ideal customer profile really looks like, and make sure you are leveraging it at every opportunity in your ad images, copy, headlines, and placements. This is fundamental to achieving good CTRs.
Turn CTR into Great CTR
Although there are newer and more complex metrics in digital marketing, CTR remains one of the essential and classic ways to measure and optimize your online ad performance. A lot of the workings of your ad strategy will hinge on boosting your clickthrough rates. Make it your business to know everything you can about your CTR today, so you can improve it and get even better results from your ad campaigns.