In layman’s terms, the click-through rate (CTR) is a metric that’s used to measure the effectiveness of an online advertising campaign. It’s calculated by dividing the number of clicks on an ad by the number of impressions (aka, times the ad was shown). The CTR is usually expressed as a percentage.
For example, if an ad is shown 100 times and receives 10 clicks, the CTR would be 10%.
Easy enough, right?
Well, the definition is quite easy, that’s for sure, but when you start running ad campaigns, you may find yourself stressing over what CTR to aim for.
Short answer? It depends.
Long answer? Keep reading to find out!
Why does CTR matter?
CTR is important because it can give you an idea of how well your campaign is performing in terms of engaging users and encouraging them to take action.
- A high CTR is generally seen as a good sign, as it means that a large percentage of people who see your campaign are clicking on it. This can be an indication that your campaign is relevant and interesting to your target audience and that it is effectively driving traffic to your website or landing page
- A low CTR, on the other hand, may indicate that your campaign is not resonating with your target audience or that it’s not effectively delivering its message or call to action. In this case, it might be necessary to optimise your campaign to make it more appealing or relevant to your target audience or to try a different strategy altogether
So, CTR is an important metric to consider when evaluating the performance of an online advertising campaign, as it can give you valuable insight into how effectively your campaigns are engaging and converting users and whether you should be tweaking different elements or settings.
What’s a good click-through rate?
Here’s the thing, although a high CTR is usually considered a good indicator of a campaign’s performance, there’s no magical number that applies to every industry. A “good” CTR will vary depending on the specific industry and goals of the campaign. For example, a CTR of 1% might be considered excellent for a display ad, while a CTR of 5% might be considered low for a search ad.
To determine whether your CTR is good, it’s helpful to compare it to the average CTR for your industry or to your own past performance. It’s also important to consider the context of your campaign and the specific goals you’re trying to achieve. For example, if you’re running a branding campaign with the goal of increasing awareness rather than driving clicks, a lower CTR may be acceptable.
Now that you understand that, let’s take a look at what’s considered to be a good CTR for different types of ad campaigns and types:
What’s a good click-through rate for PPC?
For search ads, like those displayed on Google, a good CTR is around 6-7%, according to Wordstream.
Of course, that’s only a rough guideline, and it’s important to consider the specific goals and objectives of your PPC campaign when determining what a good CTR is for your business.
Furthermore, as you optimise your campaign, you should switch your focus from CTR to other metrics, like ROI.
What’s a good click-through rate for Facebook?
When people use Google, they usually look for something specific. That explains why the platform has a higher CTR than Facebook, where users encounter ads as they’re scrolling their feeds.
According to the same source, 0.89% is a good CTR for Facebook. The average CTR ranges from 0.45% for the science industry to 1.68% for the pets and animals industry.
What’s a good click-through rate for email marketing?
When it comes to email marketing, the CTR that you should strive to achieve will depend on what kind of newsletter you’re sending. B2B newsletters tend to have a higher CTR than B2C newsletters. Nevertheless, a good CTR would be anywhere from 10% to 20%, according to WordStream.
Here, it’s important to note that the more personalised your emails are, the higher CTR you’re going to achieve.
The average CTR for banner ads tends to be closer to that seen on Facebook since these ads are also displayed to users as they’re using the Internet casually, not in a commercial frame of mind. A good CTR for banner ads across industries is around 0.46%.
What’s a good click-through rate for LinkedIn ads?
According to Meta Data, the average CTR for LinkedIn ads (for both lead generation and brand awareness campaigns) was around 0.67% in 2021 (ranging from 0.32% to 4.40%).
Is a high CTR always a good thing?
It’s generally considered a good thing to have a high click-through rate (CTR). However, there are a few circumstances in which a high CTR could potentially be a bad thing:
- If the destination of your campaign (website, landing page, etc.) is not relevant or useful to the user, a high CTR could result in a high bounce rate (i.e., a large percentage of users leaving the destination website quickly). This could lead to a poor user experience, which could hurt your brand reputation and ultimately lead to fewer conversions. Not only that, but a high bounce rate will result in bad ranking on Google and other search engines
- If your ad is being shown to the wrong audience, a high CTR could indicate that you are paying for clicks from people who are not actually interested in your product or service. This could lead to a high cost per action (CPA) and a low return on investment (ROI) (we’ll talk about those metrics later)
- If your ad is misleading or deceptive, a high CTR could lead to a high number of complaints or negative reviews, which could damage your brand reputation
In a nutshell, while a high CTR is generally seen as a good thing, it’s important to consider the context in which it is achieved and ensure that it’s not negatively impacting your brand or campaign goals.
Other metrics to consider when running an ad campaign
Besides the CTR, there are several metrics that can be useful for optimising an online advertising campaign. These metrics may vary depending on the specific goals of the campaign and the platform you use, but some common ones to consider include the following:
The conversion rate is the percentage of people who complete the desired action (e.g., make a purchase or sign up for a newsletter) after clicking on your ad. A higher conversion rate is generally better, as it means that more people are taking the desired action.
Cost per click (CPC)
This is the average amount that you pay for each click on your ad. A lower CPC is generally better, as it means that you are paying less for each click.
Cost per action (CPA)
The cost per action is the average amount that you pay for each desired action that’s completed as a result of your ad. A lower CPA is generally better, as it means that you are paying less for each desired action.
Return on investment (ROI)
Some consider the ROI to be the main metric a marketer should focus on when running an ad campaign. This is the profit or loss that you make as a result of your ad campaign, calculated by dividing the revenue generated by the ad campaign by the cost of the campaign. A higher ROI is generally better, as it means that you are getting a good return on your investment.
This is the number of times your ad is shown to users. A higher number of impressions means that more people are seeing your ad.
It’s important to choose the right metrics to track depending on the specific goals of your ad campaign. For example, if your goal is to drive traffic to your website, you might focus on metrics like CTR and impressions. If your goal is to generate sales, you might focus on metrics like conversion rate and CPA. As for the ROI, it’s useful no matter the goal of your ad campaign.
Tips for improving CTR
Now that you’ve got the answer to the question, “what’s a good click-through rate?”, it’s time for you to take some active steps to improve it. There are several strategies you can use to improve the click-through rate (CTR) of your campaigns. Here are 5 that we’ve tested and found to be effective:
Targeting is key
Use the targeting options available to ensure that your ads are being shown to the right audience. This can include targeting specific keywords, demographics, interests, or locations.
Use relevant and compelling ad copy
When crafting your campaigns, make sure your ad copy is relevant to the keywords and products or services you are promoting. Furthermore, remember to use strong calls to action (CTAs) to encourage users to click on your ad.
Optimise your landing pages
Make sure that the landing pages you are using for your ads are optimised for conversions. This means they should be relevant to the ad copy and keywords, have clear calls to action, and provide a good user experience. Of course, they also have to be fast-loading and secure.
Don’t shy away from ad extensions
Ad extensions can help improve the effectiveness of your ads by providing additional information and links to users. Some of the most popular ad extensions include image extensions, callout extensions, site link extensions, and structured snippet extensions.
Test and optimise regularly
Running an online advertising campaign doesn’t end the moment you click on “publish”. It’s a continuous process that involves a lot of tweaking and testing. Regularly review and analyse your ad data and results to identify areas for improvement. Also, test different ad copy, targeting, and landing page options to see what works best for your business and industry.
Why don’t you leave managing metrics to us?
As a business owner, you must be stressed enough about actually running your business. That’s why you ought to leave adverting and managing metrics like CTR to experts like us! Book a discovery call with us today, and we’ll take it from there.