The A-Z Guide to Understanding Click Through Rates (CTR)

 If you are looking to drive more traffic to your site, then it is important to pay attention to your Click Through Rate a.k.a. CTR.

While CTR is common to mostly PPC advertisers and email marketers; It is important to know that it covers almost every aspect of your online business.  So if you haven’t been paying attention to CTR, then now is the time to begin paying attention to your click through rates.

In this guide we will covering 5 core aspects of Click Through Rates they include:

  1. What is Click Through Rate?
  2. The Purpose of CTR
  3. Why is your CTR Important?
  4. How to determine your CTR
  5. How Does CTR affect different aspects of Online Marketing

By the end of this guide, you will have an in-depth knowledge of CTR and also know how you can use the data gotten to improve your business.

With that said, Let’s begin.

What is Click Through Rates (CTR)

Click through Rate (CTR)  is how frequent your “ad or content” is being clicked on. It is simply the frequency at which people who see your ad, content or copy end up clicking on it.

Let’s use a real world illustration to bring this home.

Take for example you have a cafe or coffee shop located on a very busy street in New York City, and around 100,000 people passes through this street everyday, eventually let’s say about 15,000 people usually come into your cafe  everyday.

Now it is important to note that 15,000 people coming into your cafe doesn’t mean they are all coming to buy. But the key thing to note here is that every single day, at least 15,000 people would come into your cafe.

From this illustration, we can say that 100,000 people sees your cafe everyday (that is impression) while only 15,000 eventually comes in (Now that is clicks). Your click through rate will be the ratio showing how often people who see your cafe end up coming in.

The two most important factors or metrics of CTR is seeing (impression) and clicking (clicks).

Take for example if 1000 people sees a particular content or advert and only 1 person clicks on it to find out more about it, it simply means that the possibility of people engaging with that advert or content is 1 person in every 1000.

Purpose of CTR

The Ultimate Goal of Click through rate (CTR) is to determine how effective your marketing campaign has been and also figure out how relevant your content or copy is to your target audience.

When you have a good click through rate, it simply means two things:

  1. Your set/target audience is relating well to your content or advert
  2. You are getting or driving more traffic to your website or landing page.

“A good click through rate does not necessarily mean good conversion rates.” They are two different things.

If your click Through Rate is good, but you are having a poor conversion rate, then you know that your website or landing page is doing a terrible job at turning your browsers to Buyers. i.e it is not converting enough of the traffic your are sending to it.

However, when your click through is bad, it is evident that your advert, content or copy is either not before the right audience, or it is not effective to cause them to click.

Why is Click Through Rate (CTR) Important?

Click Through rate is at the fore front of your marketing and it is the first most important marketing data that you will need to scale up your business.

There are two things CTR will do for you:

  • Click Through Rate will tell your whether your keywords, ads and copy are relevant to your target audience.
  • It will Show you which one of your ad, copy or keywords appeals more to your target audience

Online “Marketing is a Game of Numbers” and the more numbers you have, the more you will be in control.

While “customers are the only marketing genius“, you are the decision maker in your business. And to make the right decision you must have the right data and click through rate is one of such data.

 

How to Determine your Average Click Through Rate (CTR)

Determining your average click through rate is as easy as drinking coffee or eating chocolate. To do this, all you need to do is to divide the clicks you received by the number of impression.

The Formula is: clicks ÷ impressions = CTR.

What this formula means is simply the number of people who click on your ad divided by the number of people who has seen it.

How does it affect your SEO, PPC and Email Campaigns?

The logic behind CTR, is to simply measure the performance, relevance and effectiveness of your copy, content and adverts. In various areas of online marketing, click through has different effect on your campaigns.

Let us look at how they affect each and every one of these areas.

CTR IN SEO (Organic Click Through rates)

High Clicker Through rate means higher ranking on Google.

While it is great to optimize your meta titles and meta description with keywords and header tags etc. It is more important to write an appealing meta title and description that will communicate your message effectively to your target audience thereby helping you gain more visitors.

While some have argued that Click Through Rate is not a “Direct ranking factor”;  and If you are looking to rank, you shouldn’t really focus on it, I am thinking the exact opposite.

Here is what I mean:

Google would favour a listing that has better Click through rate, than one with little or less Clicks.

You Know why?

Because Google believes that if more people who search for the same keyword are clicking on a particular result, it simply means that particular result is relevant or has exactly what they are looking for.

Google will favour that particular listing because Relevance is the number one Ranking factor on google. 

To learn more about this, read this Wordstream Guide on Organic CTR

Click Through Rate In PPC

CTR is very important in PPC. Since it is one of the major that determines if your advert campaign is successful or not.

In PPC:

  • A good Click Through rate shows that your ads are helpful and relevant to your target audience.
  • CTR contributes to the Overall Quality Score of your ad
  • It is also one of the factors that will determine how much you will pay in the long run
  • It determines whether your advertising campaign was successful or not (Please note that your advertising campaign and your overall marketing campaign are two different things)

This and many other areas in PPC are where CTR comes handy.

You can also use CTR to determine which adverts and keywords are doing well and which of them needs to be weed out completely or improved upon.

CTR In Email (Open rate)

In Email marketing, your click through rate is also called open rate.

Which is the frequency or the number of times your email subscribers open every email you sent to them. It is important t to note that your open rate is very important and gives you critical insight into things such as:

  • How responsive your list is
  • How your list perceive you
  • How effective your email marketing campaigns has been
  • How relevant your emails are to your list

It also affects your delivery rate and shows you insight on what kind of emails your list responds more to, when they respond and how they respond.

In Conclusion:

Now you know what Click Through rate is and how it affects various aspects of your online marketing.

It is important to note that having a good click through rate doesn’t mean that you have a successful marketing campaign or that you are getting results.

Far from it, CTR is only one part of the  equation.

After all, when a person clicks on your advert or copy; he/she is usually redirected to a landing page or an article or some other content your advert or content links to and from there, they make the ultimate decision of either buying into your idea, product or service or completely leaving it.

What does this mean to you? 

It simply means that you shouldn’t stop at increasing CTR, instead you should also look to convert your traffic into buyers. While having a good click through rate is good, converting those clicks to buyers and subscribers should be your top priority.

Finally, many online marketers have messed up their marketing campaigns due to poor click through rate, don’t make that

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