Term

What is Click-Through Rate?

2 MIN READ

Click-Through Rate

Click-through rate (or CTR) is the ratio that measures the number of clicks on a specific link to the number of times people have seen the link (also known as a number of impressions). In ecommerce, CTR plays an essential role because ecommerce stores and service providers require users to make an action, for example, to buy a microwave, read an article or book a suite. 

CTR also helps businesses in developing and improving their advertising campaigns for the target audience. A low CTR is a sign for the company that it’s either targeting a wrong audience or the message is not compelling enough.

Click-through rate formula

It is quite simple to calculate a CTR using the next formula:

Click-throughs / total coverage x 100

For example, 1000 users have seen an online ad; 100 of them decided to click the link, which means that this ad has a CTR of 10%.

It is hard to say which CTR is “good” and which is “bad” due to the difference in industries, goals of ad campaigns, and even the usage of different keywords. When companies want to determine “good” and “bad” CTRs, it’s a good practice to conduct research on the average CTR of their industry.

Ways to improve CTR

It is worth emphasizing that different platforms require different approaches to improve CTR. For instance, if a business is looking to improve CTR on a social media channel like Twitter, right hashtags are a useful tool to reach the target audience. 

In general, there are 3 ways to increase a CTR:

  • A relevant headline and description.  A headline and the description should include two keywords, which the target audience is looking for. Becoming a painkiller for their problems is one of the ways to acquire new customers and have a higher click-through rate.
  • Call to action. A simple, but compelling CTA can convince people to click a link and become a new subscriber.
  • Images. Aside from interesting and relevant information users can be attracted by a curious picture. Companies can run several A/B tests with different types of images to find out whether it’s helpful in promoting their pieces of content.

 

You may also like:

Ecommerce Business Plan: The Step-by-Step Guide For Retail Companies

Top 9 Ecommerce Trends To Implement In 2020