Understanding Click Through Rate (CTR)

(Last Updated On: September 8, 2019)

The first step to understanding Clickthrough Rate is to define it. What is CTR? Clickthrough Rate, commonly abbreviated as CTR is the percentage of Impressions that produce Clicks.

Here is the official Google Ads definition of Clickthrough Rate.

Clickthrough Rate is used to measure how productive your pay per click efforts are at producing Clicks. CTR quantifies the relationship between Impressions and Clicks.

For the math inclined, the formula for calculating CTR is:

 Clicks / Impressions

Here is a very simple Clickthrough Rate example to illustrate:

An Ad has 10,000 Impressions and 3,000 Clicks. 3,000 / 10,000 = ~33%. This Ad has a ~33% CTR. In other words, for about every 3 Impressions, there was a click.

The above is the simple, straightforward explanation of what is Clickthrough Rate. But there is more to understanding Clickthrough Rate as we continue to look further. 

The thing to know when understanding Clickthrough Rate is that CTR reports at different levels within a particular PPC platform. 

For example with Google Ads, CTR is reports at the Account, Campaign, Ad Group, Keyword, Ad levels and more!  Giving you different views of CTR as a whole and from individual elements.

Account level CTR is an aggregate of all of the components within an Account. This measures the overall CTR for your Account. Top level view. Campaign level CTR consists of the components of the individual campaign. Keyword CTR is specific to a particular iteration of a keyword. 

Keyword, Ad and Campaign level CTR are the metrics that get the most focus.

Within this group Keyword and Ad Clickthrough Rate are the building blocks for Ad Group, Campaign and Account level CTR.

Ad level CTR is of particular importance. Ad level CTR is the aggregate CTR of your active keywords and other targeting settings for a particular message

As I have talked about in previous articles, for a person to Click an Ad means someone must first see the Ad. Finally, the Ad needs to connect with a person and move them to action. 

Understanding Clickthrough Rate

Ad level Clickthrough Rate measures how well your targeting and message are working together to produce a Click.

Ad level CTR is the measurement of relevance, intent and message coming together to garner an action.

Now that we have an understanding of Clickthrough Rate, let’s take a look at one of the most common questions PPC advertisers have. What is a good CTR?

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