Click-through rate
What is click-through rate?
Click-through rate (CTR) refers to the percentage of people that click on an element that
they have been exposed to. Click-through rate is calculated by simply dividing the
number of people who clicked on a given element by the total number of visitors to that
page.
CTR is a metric that is used to analyze emails, webpages and online advertising
(Google, Bing, Yahoo etc). CTR is normally used to measure the success of marketing
efforts.
CTR examples
Some common examples of where CTR can be measured include:
A call-to-action link in an email
A hyperlink on a landing page
A PPC ad on a Google search results page
An ad on a social media site such as LinkedIn or Facebook
Click-through rate is calculated by the number of clicks on an element divided by the
number of people who have seen that element. [Total number of clicks on an element /
Total number of people who saw the element]
Click-through rate and search ads
CTR is a commonly used metric when evaluating search ads in Google Adwords and
other ad platforms. Since search ads are most often pay-per-click (PPC) the average
CTR helps to determine how a given ad will perform in driving traffic, and how much the
ads will cost.
In addition to gauging performance of ad campaigns, the CTR of a search ad also has
an impact on its quality score. The higher the click-through rate of an ad, relative to its
ad position, the higher its quality score will be, leading to lower CPCs and lower cost
ads.
Digital marketing professionals can improve the performance of low CTR ads by
improving the ad copy and by providing content that is a better fit for their target
audience.
Similarly, CTR can also be important for SEO as the click-through rate of a search
result is believed by many to be one of the ranking factors in Google. The same is true
of display ads and ads across other platforms such as Facebook ads.
Unique click-through rate
One form of click-through rate is unique click-through rate: this specialized CTR
indicates that an individual click and user are only accounted for once in the formula. By
default, click-through rate measures the total clicks a user performs. unique clickthrough
rate is a more precise measurement of user behavior and interest.
An offline example of click through
rate
Imagine you are walking down an empty street with nine other friends. Everyone passes
by a coffee shop, a donut shop and a candy shop. Five of your friends go into the coffee
shop, three of your friends go into the donut shop, and you and another friend go into
the candy shop.
If we were to calculate the click-through rate of each shop, the coffee shop would have
a CTR of 50%, the donut shop would have a 30% CTR and the candy shop would have
a 20% CTR. CTR measures behavior, interaction and interest and is helpful when
determining the effectiveness of marketing efforts.
CTR should not be mistaken for conversion rate. Conversion rate is the percentage of
people who take a desired action. CTR, on the other hand, is normally associated with
an action leading up to a conversion. In the offline example, we can see that five out of
10 people prefer to go into the coffee shop. Of those five people, however, it may be
that only one person actually buys a cup of coffee.
Click-through rate & A/B testing
CTR can be used to gain useful insights in A/B testing, as a secondary metric alongside
the primary conversion metric. For example, if a conversion expert is running an A/B
test on the product display page of a clothing company, the conversion goal would be
the number of purchases completed.
A secondary metric might be the CTR of shipping information. If there is a high CTR for
shipping information, this could mean that users are interested in shipping. There may
be opportunities to draw value from the shipping information that could influence
conversions.
CTR is useful in conversion optimization. It can be used to identify user behavior, user interest
and can be used as a micro-conversion to build insights during A/B testing. CTR can help paint
a more holistic picture of user behavior in A/B testing.