What is CTR? A Detailed Guide

Publift
April 28, 2022
November 2, 2022
What is CTR? A Detailed Guide

A click-through rate (CTR) is an important digital marketing metric for digital publishers looking to improve their results on search engines.

Advertisers also use it to help improve conversions on their PPC ads and email marketing campaigns, while social media campaigners can use it to drive traffic to external landing pages.

The CTR can tell a business a lot about the success of its marketing campaign. By calculating the total number of clicks on a link, it can evaluate the strength or weakness of the ad copy, imagery, and keywords of its online advertising.

With the first organic search result on Google accounting for almost a third of clicks, understanding how to appeal to a target audience for higher CTRs is essential for those looking to compete in an increasingly digitized marketing landscape.

This article defines exactly how a CTR is calculated, why it is such an important metric in internet marketing, and what constitutes a good rate.

What Is Click-Through Rate?

Click-through rate (CTR) is a metric that is used to determine how many of those that saw an ad or free listing actually click on it.

CTR Defination

CTR Formula

CTR Formula

CTR is expressed as a percentage and can be discovered using the following formula:

(Total Clicks) / (Total Impressions) = CTR

For example, if an ad that has attracted 10 clicks from 100 impressions, then that ad has a CTR of 10%.

What is considered a good CTR varies between industries. However, regardless of the business and campaign strategy, publishers should be looking to attract high CTRs.

The reason for this is simple: the more users click on the content—whether it’s an online ad, an email marketing campaign, or a simple search engine result—the more likely the user is to take the desired action of the campaign.

In layman's terms? A high CTR generally equals a high conversion rate.

Why Are CTRs Important?

How Click Through Rate Affects Quality Score Source: Wordstream

While click-through rates (CTRs) are only one of several metrics in tracking online advertising endeavors—CPM, CPC, and CPA may be equally as telling—they are an integral benchmark in determining engagement with digital marketing campaigns.

CTRs are invaluable when it comes to A/B testing campaign performance on one or more links, which in turn determines which creative elements, including keywords and images, drive clicks.

CTR can also be used to compare which ad types are most effective. By comparing CTRs on video ads, interstitial ads, and banner ads, publishers can determine where to direct the bulk of their ad spend for maximum return on investment (ROI).

Ways to Improve CTR

There are several different elements to consider for advertisers looking to gain higher CTRs and increase the success of their campaigns, regardless of the marketing channel. For publishers looking to improve conversion rates and maximize their ad revenue, they should consider the following.

1. Develop a Strong CTA

Any advertiser worth their weight in words knows the importance of a direct and compelling call to action (CTA).

A strong CTA should contain three key elements:

  • Guidance: This tells the user what action to take.
  • Information: This tells the user what they will get when they take said action.
  • Assurance: This tells the user that performing the action is low risk with no strings attached.

Crafting a strong CTA is a surefire way to get a good click-through rate (CTR), particularly when coupled with the right keywords.

2. Optimize Your Content

While quality, well-crafted content will always be king, there are several ways to further optimize ad copy to increase the click-through rate (CTR).

Firstly, publishers should ensure they conduct thorough keyword research and use it to inform their headlines, copy, and CTA. Utilizing target keywords can help ensure the advertising is seen by the right people and that landing pages and websites appear in organic search results.

Furthermore, for those running PPC ads, utilizing ad extensions can enhance ad copy and increase ad rank and CTRs.

Ad extensions allow users to add extra dimensions to their ads, including site links and callouts.

For email marketers, segmenting the target audience so that advertising is sent only to relevant users is a proven optimization strategy.

3. Market to Your Target Audience

An integral part of developing any marketing campaign is understanding who your target audience is and marketing to them with relevant content.

While a click-through rate (CTR) tells a publisher the percentage of people performing click-throughs, it doesn't indicate the conversion rate. So while an advertiser may have optimized the content to get a higher CTR, if they are not targeting the ideal customer, other metrics, such as conversions, may suffer.

To evaluate the target audience, a publisher should look at as many elements as possible, targeting their users via a range of relevant information such as age, location, motivation, and spending habits.

Publishers and advertisers also need to consider the placement, quantity, type, freshness and content of ads, as these can all positively and negatively affect CTR.

Keeping these factors in mind will ensure a publisher is marketing their ads, email campaigns, and other relevant content to the ideal customer. And by ideal customer, we mean those that are likely to get the most value from the business offerings and therefore follow their click-throughs all the way along the customer journey to the point of conversion.

How Can I Track CTR?

Advertisers using Google Ads to run a pay-per-click (PPC) ad, a high click-through rate (CTR) impacts the content's quality score and the cost per click (CPC) of their PPC campaign—higher quality scores mean improved ad position for lower costs.

While it is handy to know the CTR formula, it’s unlikely that an advertiser will need to calculate their CTRs manually. For those running paid media campaigns, their account dashboard will display the ad’s CTR, along with several other factors such as CPC.

PPC ad campaign dashboard showing average CTR Source: Google Ads

In the same way, publishers looking to optimize their websites for SEO can log into the Google Search Console (GSC) to view their organic CTR and determine whether they are using the right keywords.

You should be tracking and monitoring your CTR in the following marketing efforts. 

1. Pay-Per-Click (PPC) Advertising

PPC advertising is a key example of where publishers should be monitoring CTR. When running PPC ads, the CTR affects multiple dimensions of the campaign.

When PPC ads run, whenever a user types the relevant keyword into a search engine, the PPC ad will appear, counting as an impression. Whether a user clicks on the landing page link will help determine whether the ad copy is strong, and is targeting the ideal user. A high CTR in this instance will also improve the ad rank.

2. Social Media Marketing

With ad spending on social media projected to reach over $173 million in 2022, social media ads are one of the most relevant marketing tools available.

While each social media platform runs its own advertising platform they all have the following feature. Ads will appear in the feeds of relevant users, increasing the likelihood of a high CTR to the relevant landing page.

All these ad platforms include dashboards that track the number of impressions and whether the ad is garnering a good CTR or a low CTR.

Facebook ads Insights Source: Facebook Ads

3. Email Marketing

When it comes to email marketing, CTR is perhaps the most important metric available. It allows email marketers to understand how many people who opened the email followed the user journey to click the link included in the email content.

What Is a Good CTR?

So, now we know what click-through rate (CTR) is and how to optimize for ads and organic search, how do we determine whether or not they are obtaining a good CTR?

This is a contentious issue and can vary greatly depending on the relevant industry, marketing channel, and its analysis in the context of other metrics such as conversion rates.

What Is a Good CTR?
What Is a Good CTR?

While the average CTR for Google Ads in 2021 sat at 3.17%, search ads in the arts and entertainment industry saw a 10.67% CTR.

Therefore, it is important to research CTRs within your specific industry and look at how your CTR is affecting other elements of your campaign such as your quality score and conversion rate.

Publift helps digital publishers get the most out of the ads on their websites. Publift has helped its clients realize an average 55% uplift in ad revenue since 2015, through the use of cutting-edge programmatic advertising technology paired with impartial and ethical guidance.

Contact us today to learn more about how Publift can help boost your ad revenue and grow your business!

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