What is CTR and know its importance

PPC ch 6
chapter 6 of PPC guide - CTR secrets

Welcome to Chapter 6 of AreteBlogs’ complete PPC guide about Click Through Rate (CTR) and its importance

In this chapter you will learn:

As discussed earlier, the PPC model is all about the more clicks, more the money made. Therefore, search engines place a great premium on a good CTR. 

Moreover, when a user turns to a search engine, they come with a query, a question, a need or a desire. They already know what they want!

Thus, creating a relevant ad is the first step for an advertiser to take in order to fulfil that need.

What is Click Through Rate

An advertisement’s click-through rate measures how many people click on a particular link compared to how many people view the advertisement in total. 

Such that,

CTR = Clicks / Total Impressions

In essence, click through rate is the percentage of impressions that resulted in a click.

For example, If your PPC-ad had 2000 views and 4 clicks, that’s a 0.2% CTR.

A website’s online advertising campaign is typically evaluated using this metric.

As a metric, click through rate tells you how relevant searchers are finding your ad to be.

If you have a:

  • High CTR, users are finding your ad to be highly relevant.
  • Low CTR, users are finding your ad to be less relevant.

Ultimately, PPC campaigns are designed to help you get qualified users to come to your website and take action (e.g., make a purchase, fill out a lead or contact form, download a spec sheet).

What is a Good CTR

One can not specify a good click through on a vague scale. A good click-through rate depends on many different factors. 

Some of the important factors that determine either your CTR is good or not are namely, 

  • Your industry
  • The keywords you are bidding on
  • Individual campaigns within a single PPC account

Thus, a double-digit CTR on branded keywords is not uncommon when someone searches for the brand name of your product or the name of your brand.

Similarly, it also isn’t unusual to see CTRs of less than 1% on broad, non-branded keywords.

How  CTR impacts Ad Rank and Quality Score

The CTR is more than just a measure of how relevant your ads are to searchers. CTR also contributes to your Ad Rank in the search engines.

Ad rank determines the position of your ad on the search results page.

That’s right – PPC isn’t a pure auction.

No matter how much someone bids, the top position doesn’t go to the highest bidder. Advertisers with the highest Ad Rank will receive it. Thus, rank is heavily influenced by CTR.

But Ad Rank is even more complicated than that. Google measures your actual CTR against an expected CTR.

As such, if you have run a lot of ads with a low click-through rate, Google will assume that any new ads you add to your Google Ads account will also have a low click-through rate, and they may appear lower in search results.

This is why it’s so important to understand the CTR on your ads and to try to improve it as much as possible.

A poor CTR can lead to low ad positions, no matter how much you bid.

Similarly, a good CTR will help you earn higher Quality Scores.

Quality Score is a measure of an advertiser’s relevance as it relates to keywords, ad copy, and landing pages.

The more relevant your ads and landing pages are to the user, the more likely it is that you’ll see higher Quality Scores.

Quality Score is calculated by the engines’ measurements of expected click-through rate, ad relevance, and landing page experience.

Continue to learn more.

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