CTR stands for Click-through Rate, which is a common term in online advertising, one every marketer should be familiar with.
It has several uses, but in call cases it refers to the percentage of people that “click” on something after seeing it. For banner or search ads, it’s the rate of clicks per impression served. For email, it’s the percentage of recipients who click on one of the links provided in the email.
It is almost always expressed as a percent. So the formula we use to calculate click-through rate is as follows:
CTR = Clicks/Impressions x 100%
Why is click-through rate important?
In online advertising, CTR is a common metric marketers use to determine the effectiveness of an ad. The more people we get to click on an ad, the better, generally speaking. So our goal is to test out new ads, with better copy or designs, in an effort to improve the CTR.
In email marketing, CTR is a common metric marketers use to determine whether or not an email generated sufficient response. A higher CTR signals more interest from subscribers, more people visiting your site or entering the sales funnel. We test new emails, with better copy or designs, to increase CTR.
Understanding CTR and how to measure it is important if you want to succeed in the digital advertising world.