What is Click-Through Rate?
“Click-Through Rate is the fuel for businesses.”
ClickThrough Rate (CTR) is the ratio between how many people are exposed to an Advertisement against how many people end up clicking on the Advertisement. CTR measures the success of an online marketing campaign and is both a key performance indicator and factor in determining ranks on the Search Engine Results Page (SERP).
The way your advertisement is framed is integral to this process.
How is Click-Through Rate Calculated?
CTR is measured by dividing the amount of actual clicks with the total amount of impressions. For example, if you had 20 clicks and 1,000 impressions, then your CTR would be 2.0%:
Impressions indicate how often an Advertisement showed up, while a Click is when a searcher interacts with the Advertisement by clicking on it. Though CTR gives a good indication about your online performance, there are some false positives about the way impressions are measured.
One impression for you advertisement is counted each time a person ends up at the SERP where your advertisement is listed. But this doesn't mean that searchers actually see your Advertisement, as sometimes only half of the results are shown above the fold.
There isn't room for everyone on the SERP, so the majority of the search results are below the fold, which naturally have a lower CTR. Google doesn't take above or below the fold in to account when counting an impression. This gives false positives, as there is a high change a searcher didn't even see your ad when on the SERP.
Keep in mind, if you have a high number of impressions and your CTR is still below average, it can also mean that you are targeting the wrong key keywords, or your ad is not appealing enough.
What is a Good Click-Through Rate
It is hard to say what a good Click-Through Rate (CTR) is, as it varies between the keywords used, the position, the audience, the type of industry, etc.
According to Google, the average CTR for AdWords Campaigns is only 2%, and anything over 2% can be considered above average. The biggest factor influencing CTR for Pay-Per-Click Advertisement is the position of the Ad. The following chart shows CTR decreasing by Ad position:
Let's take a closer look at the chart: Seems like a pretty consistent trend here. But the question is this: does a 4% CTR for position 2 and a 2% CTR for position 4 mean that they have a good CTR?
No. They are average CTRs, which means that other advertisers are doing better. A good CTR can therefore be considered worthwhile if it’s at least twice as high as the average CTR for that position, both in terms of the keyword and industry.
Another factor to consider when looking at average CTRs is that the majority of advertisers are not aware that they should constantly optimize their PPC campaigns. This lowers the average CTR and makes using the average CTR as a reference point as misleading.
Credibility vs Clickability
Remember a high Click-Through Rate (CTR) doesn't actually sell anything. CTR and Conversion may even share an inverse relationship. An advertisement geared toward curiosity click will result in fewer sales, percentage-wise, than an advertisement geared towards qualified clicks. This is because often times, searchers are routinely disappointed after clicking on a PPC Advertisement, as the page behind the ad is often irrelevant to their search query.
Preferably, you want a combination of both credibility and clickability for you Ad copy.
"The hot new phone everyone is talking about"
"Apple released the Iphone 6"
The term Clickability is self-descriptive really – it refers to the “desirability” you have to click onto a website link. Advertisement with high Clickability most often have a provocative headline that is difficult for most users to resist.
Credibility is all about how trustworthy your headline or description is, at least in the eye of the searcher. Unfortunately, a credible search result often doesn't catch the attention of a searcher at first, and as a result often have lower CTR.
How Can Predikkta help?
Determining the right advertisement to increase CTR for unpaid and paid search results is difficult. This is why a Predikkta Survey is most useful for comparing different search results.
With Predikkta, you can test thousands of variations of search results against each other, in what seems a 'simple survey'. Test highly credible or clickable Ad Copy, or maybe a combination of both. Find out the difference in CTR and choose the best result for your business.