Click through rate (CTR) is a KPI that tracks the ratio of clicks of an ad, link, or email received as compared to the number of times it is displayed.
What is Click-through Rate?
Click-through rate (CTR) is one of the most important KPIs (Key Performance Indicators) for brands to measure the effectiveness of their digital marketing campaigns.
The meaning of CTR is simple, it is the overall percentage of the users who click on a link, ad copies, or other CTAs (call to action) as compared to the total number of users who have viewed it.
In the performance marketing domain, a higher CTR percentage means that your ad copy is engaging enough for viewers that it pushes them to take a specific desired action.
Why CTR is Important in Performance Marketing?
The click-through rate (CTR) plays an important role in performance marketing as it shows how well a campaign is performing to attract its target audience.
A higher click through rate shows your ad campaign is relevant to your target audience to encourage them to take desired action. In performance marketing, the goal is very simple, to drive measurable actions like conversions, sign-ups, or purchases.
- Engagement Stats: CTR shows how engaging and relevant your ads or content are for your target audience. A higher CTR means that more users are interested in your copy or ad campaign and will take the desired action like signing up for a program, purchasing products, etc.
- Optimization of Campaigns: Creating a campaign is not enough in performance marketing, you have to optimize it for the best ROI (Return on Investment). As a marketer, to identify which of your ad campaigns are performing best, you have to track KPIs such as the CTR to improve performance and your ad spend.
- Tracking the Effectiveness of Targeting: Without accurate targeting, reaching the right audience is very difficult. A low CTR means your targeting is not accurate and will reduce the number of impressions on your ad campaigns because users are not interested in your products or services. By monitoring CTR, a marketer can target the right audiences that are specifically interested in their campaigns.
- Correlated to Conversions: A high CTR means your ad campaigns are reaching the right audience with a clear CTA (call to action) which means you will get more qualified leads. This, in turn, will increase conversions like demo requests or free trial sign-ups.
- Better Reporting and Analytics: By analyzing the CTR of your ad campaigns alongside other performance metrics, marketers will help marketers complete their specific goals like getting leads, sales, sign-ups, etc.
- Cost Efficiency: Since CTR impacts quality score, it can reduce overall ad costs. Higher engagement normally means you’re reaching the right audience that will be more cost-effective for getting clicks and conversions.
How to Calculate Click Through Rate?
Click-through rate (CTR) is a simple, yet powerful KPI to determine the performance of your ad campaigns, emails, or links.
Calculating CTR is straightforward, it’s the percentage of people who clicked on your link or ad campaign compared to the total number of people who saw it.
The formula for calculating CTR is:
- CTR = Total Clicks/Total Impressions × 100
The above-given click through rate formula helps you calculate the percentage of impressions that have converted into clicks.
For example, if an ad campaign received 200 clicks and 5,000 impressions, then:
- CTR = 200/5000 × 100 = 4%
What is a Good Click Through Rate?
A “good” click-through rate (CTR) can vary based on a lot of factors such as the industry, ad format, platform, budget, and target audience.
CTR benchmarks differ across different platforms (e.g., search, display, social media) and ad types (e.g., banner ads, native ads, video ads). These CTR benchmarks can fall under the range of 0.5%-5% and maybe even higher at times.
Although, industry standards help provide a general view understanding how to align your CTR with your specific campaign goals matters most.
If you are running an ad campaign to get conversions or lead generation, a good CTR will help you get conversions through your marketing funnel.
How to Improve Your Click-through Rate?
To maximize the effectiveness of your ad campaigns, improving the CTR is necessary. Below are some of the strategies that you can use to improve your CTR:
- Refine Your Targeting: Know your targeted audience for proper audience segmentation to ensure that your ad campaigns reach the right audience. The more you define your target audience based on demographics, interests, behavior, and even location, the better CTR you will be able to get.
- Write the Best Ad Copy: Make your headline more clear, concise and compelling. Use action words like buy, get, shop, etc. Also, use numbers or percentages like “Save 20% today!” or “Boost your ROI by 50%”. Focus on what your unique selling point (USP) is and showcase the benefits of your product or service.
- Use Strong Calls-to-Action (CTAs): Use strong yet simple CTA that tell users exactly what to do next like “Get Your Free Trial”, “Request a Demo”, “Download Now”, etc. Use words that create a sense of urgency like “Limited Time Offer” or “Act Now” that encourage users to take immediate action.
- Optimize Ad Design (Visuals and Layout): Whether you are running a display or a search ad, make sure your creatives are visually appealing and attract users to click on your ad campaign. Use colors and images to get users’ attention but make sure to avoid clutters. However, it is important to increase brand awareness and trust through consistent creatives to engage users with your content.
- Use Ad Extensions (For Search Ads): The site link extensions allow you to add more links to your search ad, increasing the chance of a click. A site link extension provides more information about your offer like “Free Shipping” or “24/7 Support” which makes your ad campaign more appealing.
- A/B Test Your Ads: Use different headlines, images, and CTAs to see which version of your ad campaign performs better and improves CTR. Keep in mind, that you have to continuously refine your ads based on A/B test results to improve overall CTR.
- Improve Landing Page Relevance: You have to ensure that your ad copy aligns with the content on your landing page increasing the chances of conversion. But, even the best ad copy or landing page will not be able to get you conversions if the page load speed of your landing page is too high. So, make sure to optimize your landing page in such a way that it loads quickly, especially on mobile devices.
- Use Relevant Keywords: If you are running search ads, use relevant keywords that meet the search intent of your target audience. Relevant and targeted keywords will bring in more clicks because they align closely with what users are searching for. To save your ad budget, use negative keywords to stop showing your ads to irrelevant users.
- Use Social Proof: Social proof can increase the trust and credibility of your ad campaigns. Use positive reviews or user testimonials in your ad copy or landing page. You can add UGC (user-generated content) like showing how real customers are benefiting from your product or service in your ad campaigns.
- Use Retargeting and Remarketing: To reduce your ad spend budget, you can retarget users who have already interacted with your website, ads, landing pages, or content and encourage them to complete the desired action. Other than this you can show them personalized ads based on their past behaviors. For example, you can retarget users who have seen your product but did not complete the purchase, with a special offer.
How to Optimize Your Click-Through Rate (CTR) with Trackier?
Trackier offers many features to optimize your click-through rate by audience segmentation, retargeting campaigns, A/B testing of creatives, and many more.
- Audience Segmentation: With Trackier, you can segment your audience based on their demographics, behaviors, and interests. By doing this, you can target the most relevant audience for your ad campaigns which helps improve the CTR.
- Retargeting Campaigns: Create your retargeting campaigns with Trackier to show ads only to the users who have already interacted with your brand but did not complete the desired action like purchase, sign-up, fill up a form, etc.
- A/B Testing of Creatives: Run A/B tests on your ad creatives (headlines, images, videos) within Trackier to identify which of your ad variations perform best and improve CTR.
- Keyword Performance Monitoring: It is important to monitor your keyword performance to improve the CTR. Trackier offers detailed analytics on keyword performance so that you can adjust bids or choose more high-performing keywords to increase CTR.
- Real-Time Campaign Adjustments: Real-time reporting is necessary to know when you have to adjust your campaign. On the Trackier dashboard, you get real-time reporting and campaign analytics that help you to adjust targeting, creatives, or bidding strategies.
- Landing Page Optimization Insights: Even having the best ad copy or product cannot guarantee that you will get a high CTR. You have to check your landing page performance for better conversion. With Trackier, you can track landing page performance alongside your ads.
