Click Through Rate ( CTR )

May 22, 2020

Lead generation and its eventual conversion is the bedrock of any ad campaign embarked upon by business owners or digital marketers. Even SEO enthusiasts are keenly aware of the importance of getting results with any marketing strategy. For a fact though, time and money are at risk. Certain metrics can help you monitor the performance of an ad campaign. One of such valuable metrics you should be using is the CTR, which simply stands for 'Click Through Rate'. A high Click Through Rate value reveals that your ad has generated more interest and your audience finds it to be engaging. But there is even more to it. Here, you will find all there is to know about Click Through Rate (CTR), why you must monitor it, how to optimize it, as well as its relationship with paid advertising.

 

What is the Click-Through Rate?

 

Simply, "Click-Through Rate" can be defined as the number of times a link or an advertisement has been clicked. Click-Through Rates (CTRs) are usually indicators of whether an online advertisement campaign now successful or not. CTR can be used to determine quite a number of things. With tools like Google ads, CTR will determine whether you end up with a great quality score or not. In the digital marketing click-through rate is a metric used to measure the trajectory of the campaigns that are. Search engines place a lot of importance on CTR. This is because the metrics from Click-Through Rates can also determine whether your ad is relevant by the search engine users. If your click-through rate shows that your ad is not relevant to the search, the quality score decreases.

 

 

How is CTR calculated?

 

Click-Through Rate is calculated using the number of times your ad has been clicked and the number of times your ad was shown. It is essentially the number of times the ad was clicked, divided by the number of times the ad was shown. The number of times the ad is shown is referred to as impressions. It is worthy to note that while there may be high impressions, it does not always translate to clicks. Impressions only show the number of people that have seen the ad. Depending on the type of ad displayed and its target market, there may be huge disparities between the impressions made by an ad and the actual clicks. 

 

Here is an example of how Click-Through Rates are calculated. If an online advertisement has been clicked 500 times after being displayed 2000 times then 500 (clicks) is divided by 2000 (impressions). This outputs 0.25, which is then multiplied by 100 to get a percentage. The click-through rate for this sample advert will, thus, be 25%.

 

 

Why is CTR important?

 

The Click-Through Rate indicator is very important for several reasons. Some of these reasons are:

 

Feedback

Click-Through Rates provide valuable feedback about the effectiveness of adverts. Click-Through Rates can be used as a report to see whether the advert is being engaged by the target market. It can also indicate whether or not the adverts are effective in selling the products or services.

 

Specific marketing channels

One thing with Click-Through Rates is that they can be measured in emails, websites, blogs, and several other places. Click-Through Rates can also prove to be a clear indicator of which marketing channels are more useful than others. For example, Click-Through Rates can show that clicks from cold emailing are higher than the clicks gotten from blog posts. This is treated as a valuable output when conducting online marketing campaigns.

 

Ad rank

Click-through rates also have an effect on your ad rank asides being able to determine whether your ad is relevant or not. In what way? If you have a high click-through rate then it would be clear that your advert is relevant and your rank would increase accordingly. Therefore, the Click-Through Rates of your ad will undoubtedly affect your ad ranking and this will also affect a lot of other things. 

 

Lower Costs Per Clicks

A high number of Click-Through Rates can drastically reduce the amount of money spent per click. While it may not seem like a lot, in the long run, it adds up and is very important. The method by which AdWords determines the price you pay per click is by multiplying your given quality score by the bid price. The quality score is a result of CTR. When you have a lower Cost Per Click then you have more money to drive into making a better advert in different locations.

 

How to optimize CTR

 

To make the most of click-through rates and drive your target market to your ads, your CTR must be optimized. Optimizing your CTR ensures that you get the best results possible. This includes that your ads are effective in reaching the markets that they are intended to. A click-through rate is the first step in leading to a conversion rate. 'Conversation rate' here refers to the end goal of your click-through rate. It can be in the form of consumers paying for certain goods or services, signing up for something, or downloading a book. To get the highest possible conversation rate, Click-Through Rates must be optimized to their fullest potential. This can be achieved using the following ways:

 

Keywords

The use of the right keywords cannot be overemphasized. Keywords, when used right, will yield brilliant results. On the other hand, when used wrong, they will fail. This might even reduce your quality score. When considering what keywords to use, it is important to think of what services or products are being offered and how to phrase it correctly. The best way to determine the keywords to use in your Click-Through Rates is to think from the perspective of the searcher or buyer.

 

Testing

While you may have put in a lot of thought and effort into determining how to optimize your click-through rate, there is only one sure way. Test it. Putting together an ad and testing it gives you real insight as to whether the keywords you used are effective or if the placements of the ads are either good or bad. Testing will provide valuable input that can be used to create better ads and allow you to use better keywords. It will show the best place to put some of your advertisements and the premium ways to get the desired effects. The information from testing can be applied to other ads too.

 

Avoid generic phrases

Generic phrases are generally disliked and using them in ads is a terrible way to get a target market. Generic phrases often use specific words or words that are synonymous and so people usually disregard them when they show up. A simple reason not to use these phrases is that they create the image that your ad is the same as a million other adverts. A quick test will show through the Click-Through Rates that generic phrases are not much liked and this will be reflected in the quality score. Using generic phrases also means that you have to compete with rival businesses on the use of keywords. This will mean that the voice of your ad gets drowned out by others as competitors. As a result, the Cost Per Clicks might even go up.

 

Use of visuals.

To improve Click-Through Rates for your ad, you should incorporate bright and vivid colors. These images, however, have to remain relevant to the thing being searched for. People are more convinced by images than they are by words and so you can utilize this. Images can draw your target market in and convince them that clicking that link is not a bad idea. Images also have a direct impact on people’s decisions. For instance, if your ad was about a dress, then a picture of a beautiful dress will go a long way in convincing people to click the link.

 

Target audience

What is important to remember when deciding about ways to improve the CTR of an advert is the target audience. The focus of optimizing your click-through rate is for your target market to click on the link more. This purpose may, however, be defeated if the ad is not directed at a target market and just anyone clicks the ad. This is because, in that manner, there is sure to be a drop in the conversion rate. That is to say, the clicks will not likely be converted to actions such as buying products. In all that is done, the target market's interest should be considered and put at the core of decision making.

 

CTR and Paid advertising

 

 

 

Click-Through Rates are essential for making paid advertising work. After all, paying for an ad means you have to make the most out of it. Using CTR as a metric for measuring how effective the advert is can be very worthwhile. It will even provide a guide on how to get more clicks. Tools like Google ads offer discount prices for clicks when an ad is deemed relevant. And one way of determining ad relevance is through CTR. The most important use of Click-Through Rates in paid advertising is determining how many people click on your advertisement. A digital marketing campaign will not be complete when the click-through rate is not constantly monitored and the input, used to create better products. While Click-Through Rates do not always end in actions like purchases, it also gives back value for the money spent on the paid advertisement. For instance, you could be advertising your bespoke shoe business on a website and then, with CTR, realize that the website has the wrong demographic for you.

 

Wrapping Up 

 

CTR provides a clear map of where is best to pay for advertisement. Adverts for certain products cannot be placed in any random place.  A business selling skateboards, for example, will have a greater yield advertising on social media than using the cold emailing method. In effect of the above, the click-through rate is a guide on where to post your paid advertisement, what words to use, and how the general public interacts with your paid advertisement. No matter the yield of your paid advertisement, you get some form of valuable input from using the Click-Through Rates. So, as a digital marketer, webmaster, SEO expert, or business owner, CTR should not be neglected to get the most of your ad campaign and marketing efforts. 

 

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