Why is Click Through Rate (CTR) Important?


The idea of Click Through Rate is very popular among advertisers and marketing individuals. A click-through rate is the number of visitors who reached your landing page from your ad impressions. 

Achieving a high click-through rate is necessary to your PPC ad campaign success. It directly affects both your Quality Score and how much you pay every time someone clicks your advertisement.

What Is Click-Through Rate?

PPC click-through rate is the ratio of clicks you receive on your ads. This number is the percentage of people who view your ad (Ad impressions) and then actually go on to click the ad (clicks). 

CTR looks like this:

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

You can view your click-through rate in the dashboard of your PPC ad account along with other metrics. A high CTR means that a high percentage of people who see your ad and click it.

Why Do Click-Through Rates Matter?

Click-through rate is important to your ads because it directly affects your Quality Score. Google Ads and other search marketing platforms offer pricing discounts for ads that offer high relevance (read: make searchers happy). One means for doing this is to offer higher Quality Scores to ads with high click-through rates:

  • High click-through rates lead to higher Quality Scores.
  • Higher Quality Scores help you improve or maintain ad rank at lower costs.

Also, if you are advertising on relevant queries, achieving a higher CTR means that you are driving the best possible number of people to your landing page.

What is a Good Click-Through Rate?

The honest answer to the question is, “It depends.” Click-through rates are going to vary from campaign to campaign, and also from keyword to keyword. Everything involved in the way your ad is displayed plays a part, from your ad copy to the ad’s ranking on the results page.

The average click-through rate will vary in between industries, and your expected CTR depends on your ad rank and many other factors.

The average CTR in Google Ads is close to 2% for search and 0.4% for display. So, as a rule of thumb, a good Google Ads click-through rate is 4-5%+ on the search network or 0.5-1%+ on the display network.

Higher Click-Through Rates Being Bad For Business

If a keyword isn’t pertinent to your business or isn’t going to generate sales, leads, branding gains, etc. a high click-through rate for the term is bad for business. The reasoning for this is fairly clear:

  • You’re paying for every click.
  • A higher number of clicks generate a lot of ad spend.
  • Sometimes you’re generating clicks on keywords that are priced too high, and won’t turn a profit even if they convert.
  • Irrelevant terms and clicks are spending your money without bringing in additional business.

You don’t always want higher click-through rates. What you want are high CTRs on keywords that are:

  • Relevant – Based on your ad text, your landing page, and your offering.
  • Affordable – Keywords that aren’t going to be so profitable.

To sum it up, a good CTR means targeting the right words and getting as many people as you can to click on those ads.

Achieving Strong Click-Through Rates For Your Ads

Achieving strong click-through rates in PPC depends on:

  • Targeted keywords to bid on.
  • Cost-efficient clicks.
  • Tools and strategy for closely integrating keywords with ad text and landing pages.
  • The ability to quickly and efficiently segregate keyword groups to create a closer targeting.

The higher your CTR, the better your Quality Scores will be, and higher Quality Scores are one of the best reasons for success in PPC.

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