What is Click-through Rate(CTR) & Why It’s Important

CTR
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In as much as click-through rate (CTR) is important to search engines (in the pay-per-click model, the more someone clicks, the more money that search engine makes), it’s equally important to advertisers.

Why so?

When a user turns to search engines, they obviously looking for an answer. This is a clear indication of them expressing a need or want.

In this article, we’ll cover what click-through rate is, what a good CTR is, how it impacts your ad rank and Quality Score, and when a low CTR is OK.

What is click through rate(CTR)?

Click-through Rate

This is a term used in referring to the percentage of people visiting a web page from an advertisement or organic search result.

To put it simply, CTR is the percentage of impressions that resulted from a click.

If your PPC ad had 1,000 impressions and one click, that’s a 0.1% CTR.

Click-through rate tells you how relevant searchers are finding your ad to be.

If:

  • High CTR, users are finding your ad to be highly relevant.
  • Low CTR, users are finding your ad to be irelevant.

What is a Good Click-Through Rate?

CTR is relative to:

  • Your industry.
  • The set of keywords you’re bidding on.
  • Individual campaigns within a PPC account.

For pay-per-click (PPC) ads, you always want your click-through rates to be high and it’s important for overall campaign health to do so. The CTR directly affects Quality Scores and that’s what’s used by the Google Ads algorithm to determine how much you, the advertiser, will pay for each click.

How is Click-Through Rate calculated?

 Basically, it’s the percentage of people who view your ad (impressions) divided by the ones who click your ad (clicks).

(Total Clicks on Ad) / (Total Impressions) = Click-Through Rate

High CTR

If you have a high CTR, it means that users are finding your ad or webpage to be engaging and highly relevant. With branded keywords, you may see a double-digit CTR. In some cases, click-through rates of less than one percent on broad, non-branded keywords are not abnormal.

Low CTR

If you have a low CTR, it means your ad or webpage is not engaging or highly relevant enough for the user to pick. This can be due to bad copy, creativity, or poor targeting.

How CTR Impacts Quality Score

Quality Score is calculated based on the combined performance of 3 components:

  1. Expected clickthrough rate (CTR): The likelihood that your ad will be clicked when shown.
  2. Ad relevance: How closely your ad matches the intent behind a user’s search.
  3. Landing page experience: How relevant and useful your landing page is to people who click your ad.

A good CTR will help you earn higher Quality Scores

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