What is the click-through rate?
Click-through rate, or CTR for short, refers to the ratio of clicks on an ad to the total number of ad impressions displayed. The CTR is a key performance indicator that measures the effectiveness of advertising campaigns and can be very interesting if billing is based on the CPC model/cost-per-click. By definition, the “click-through rate”, “click-through ratio” or “click-through rate of a website” is a key figure that expresses the ratio of the number of clicks on a digital advertisement to the ad impressions as a percentage. The number of these shows how often a user has viewed the advertising material in a certain period of time. In relation to the actual clicks on the respective affiliate medium in this period, these two key figures result in the CTR, the so-called advertising click rate.
How does Google calculate the click-through rate?
The calculation of the click rate is generally always a ratio between the values. How often was something clicked on or displayed? A period is defined in advance for both values so that a daily, weekly, monthly or annual CTR can be obtained, for example. The click rate also relates to a specific search query, a specific keyword.
CTR = (number of clicks / number of impressions) * 100%
2% = 20 clicks/ 1000 displayed banners/ impressions * 100%
A high CTR is also always related to the advertised product and the network of ad impressions. It helps to assess which ads (or keywords) are successful and which have potential for improvement. In AdWords, the CTR is part of the determination of the Quality Score.
The average CTR is estimated at only 2% to 3% due to user desensitization. Expressed as a percentage, it provides a better overview of the efficiency of an ad than absolute figures. For a more specific view of the success of an ad, the conversion rate is even more meaningful. CTRs can vary greatly depending on the type of impressions.
The importance of CTR in online marketing
The click-through rate is an important keyword performance indicator (KPI), an indicator of how well or poorly the performance of a digital advertisement is tailored to the user. In online marketing, e.g. in affiliate marketing, this information is of great relevance, as the efficiency of the advertising media used is expressed in figures. For example, the cost-per-click rate is measured, which is crucial for companies, as the advertising costs per click are decisive and are used as a benchmark.
The click-through rate in the SERP area
In the SERP area, on the search results pages, the CTR is a relevant factor in search engine optimization when considering the effect of snippets. A high SERP CTR, for example, can indicate whether a snippet will lead the user to a link on Google. To place digital advertising on Google, you can use Google AdWords, a payment program for banner advertising.
When looking at the click-through rate, however, a distinction must be made between organic search results and AdWords:
- The click-through rate in organic search
Google shows in the Search Console (search analysis report) how high the CTR is for certain keywords, a certain threshold value of impressions and clicks should be given.
- The click-through rate in AdWords
With AdWords, Google outputs CTR values at keyword and ad level. These can be found in the respective tab in the campaign view. The special feature of AdWords is the expected CTR, which is used when placing ads. Here, not only the previous CTR for an ad is taken into account, but also factors such as the type of device, the time of the auction and the keyword used.
SEA optimization of the click-through rate
In order to optimize search engine advertising with a higher CTR, you can, for example: place the ad impression on pages that match the content of the ad in order to address specific target groups; change the design (size, format or content); use retargeting.
Direct advertising success through click-through rate?
No, unfortunately it’s not that easy to understand. Only then, when the number of conversions indicates whether a visitor has actually been persuaded to complete a purchase or something similar that describes a conversion. However, the click rate indicates whether the user considered the promise to be interesting when they clicked on it. An increase in CTR cannot be equated with the success of an advertisement.
The aim of an advertising campaign is not to increase the CTR. The CTR only provides clues as to whether the ad impression has been set correctly or whether it needs to be re-targeted and optimized.