In ecommerce, there are very few tasks that are more important than quantifying and analyzing your online marketing efforts. Whether you’re running social media advertising campaigns or using search ads to reach your target market, you need to make sure that your investment is bringing in enough qualified leads to be worth it.
There are many key performance indicators (KPIs) you can use to evaluate the success of your digital marketing campaigns, from the number of clicks to the conversion rate. In this article, we’ll take a look at one of the most important: click-through rate (CTR).
We’ll start by covering:
- how to calculate your click-through rate,
- how much the average CTR changes based on industry, and
- how much the average CTR varies for different types of ad campaigns.
Then, we’ll share some best practices that can help you improve your CTR and achieve an above-average CTR!
Let’s get started!
What is a click-through rate and how to calculate it?
Click-through rate (CTR) is a metric that tracks the number of clicks your content gets (it could be an ad, an email, or any clickable element) relative to the number of people that have the opportunity to click on your content (total impressions).
You can calculate the click-through rate of an ad campaign with this easy formula:
Click-through rate is one of the most important KPIs to keep track of because it helps quantify the success of your ad spend in a more results-driven way than simply tracking impressions. Although impressions can help to create brand awareness, you need to be generating qualified leads from your ad campaigns.
After all, a click means that a user is actively interested in your content and has decided to interact with it. Will they become a future customer? It’s certainly possible!
What's the average CTR and what is a good CTR?
What counts as a high CTR will differ according to the type of ad you’re running and the industry you’re in.
For example, the average CTR for Facebook ads is different from the click-through rate you can expect to see on a landing page. Similarly, the industry average CTR is very different in the SaaS space as compared to fashion-focused DTC brands.
Let’s take a look at the average CTRs for different types of campaigns:
- Search ads: 6.30%
- Display ads: 0.05%
- Facebook ads: 1.11%
- Instagram ads: 0.22%
- LinkedIn ads: 0.22%
- Twitter ads: 0.86%
- Email marketing campaigns: 2.3%
Of course, these click-through rates for specific ad types can differ by industry. Every industry has its own average click-through rate for each of these ad types.
You need to think about which ad format and platform suits your industry and your company best. What kind of products do you sell? If you’re a tech-focused company, you might want to focus on Google ads because people tend to search for technology products there. On the other hand, it makes sense to focus on Instagram ads if you’re a beauty brand.
If you see that your CTA is above your industry’s average, you can conclude that you have a “good” click-through rate. But take that with a grain of salt, because click-through rates will always depend on factors like the keywords you use, the bid limits (for PPC ads), and the relevance of your ad to your target market.
Relevant keywords and advertisements will be more cost effective and lead to a higher CTR, so focus on creating content that people will want to click on.
How to achieve a good CTR on different platforms?
Let’s say you manage to achieve a 7% CTR on a Google ads campaign for some search terms that are relevant to your target audience.
This is a pretty good CTR, outperforming the average CTR for search ads. However, there are still ways to increase that CTR and generate more leads.
On a related note, you also want to think about how well the traffic you’re generating converts once they hit your landing pages. Even if you have high click-through rates, you’re just wasting time and money if your customers are bouncing off your website immediately.
Now let’s see how you can achieve a good CTR on different platforms.
1. Google Ads
There’s a lot that goes into achieving the highest CTR possible on Google ads. You need to make sure you’re using sound search engine optimization principles (like using the right keywords and avoiding negative keywords) and that your ad copy, meta description, and call-to-action are all on point.
All that complexity means that there’s a lot that can go wrong in your quest for ad clicks.
Let’s use an example to see how you can perform well on the Google search network. Imagine you’re advertising whole-bean coffee with “coffee capsules” as the targeted keyword. You see that you have a low relevance score in your Google ads account, which which means that the Google ads search network judges that your ad isn’t as relevant as ads from other people bidding for the same keyword.
Let’s say your quality score is 2/10, while your competitor’s quality score is 8/10. A possible reason for this might be that their landing page is about coffee capsules and the text of the ad is more precise than yours.
Where your ad ranks is based on your relevance score and your bid limit. It’s all governed by this formula:
Ad rank = your relevance score x your max bid limit
If you’ve set your max bid at 10 USD, your ad rank is going to be 2×10, or 20. And if your competitors’ max bid is only 3 USD, they’ll still win due to their quality score, since their ad rank will be 3×8, or 24. In this example, even if you spend more, your “opponent” will rank better. That means that your ad is still going to be placed below your competitor’s search ad.
In this case, you can improve your CTR by doing more keyword research to discover relevant long-tail keywords and earn higher quality scores. This will prevent you from having to spend much more than your competitors to get the same Google ads CTR. You can also take a look at other factors that can affect your search ranking, such as page load times and meta descriptions.
2. Facebook Ads
Facebook offers many ad types focused on different goals, such as brand awareness, event marketing, and conversion, as well as many different ad formats like image ads, carousel ads, and video ads.
You’ll have to do a lot of experimentation to discover which types of ads work best for your target audience.
For example, if you try out video ads but find that you’re getting a low average view duration, it makes sense to switch to image ads or use shorter video ads. A/B testing is the best way to get higher click-through rates, since your decisions about which ads to use will be based on hard data.
After you’ve decided which type of Facebook ad will be the best fit for you, you can improve your conversion rate by personalizing your landing page copy for each ad campaign you run. For instance, a supplement company might run two campaigns on Facebook, one focused on weight loss and the other on sleep quality.
In this case, it’s crucial that users see content that’s related to the ad they clicked on once they hit the website. A user who clicked on the ad about weight loss isn’t going to be interested in content that focuses on sleep quality, so they’ll quickly bounce.
You can use OptiMonk’s Dynamic Content system to make the most out of each click by personalizing your landing page headlines and copy.
3. Email marketing
When it comes to email marketing, you need to modify the click-through rate formula slightly to reflect the fact that not all your emails are delivered. Here’s how to calculate your click-through rate for email marketing:
CTR = clicks / (sent emails – bounces)
Once you know how to calculate your email marketing CTR, you’ll want to figure out how to improve it.
As you’d expect, the more relevant your content is, the better. Your email ad copy should be short and to the point, and the way you write should resemble the way your target audience actually talks.
Also, you don’t want to overwhelm your customers’ inboxes with tons of emails, since visitors will simply stop opening your emails or even unsubscribe if they’re getting bombarded.
Finally, you need to make sure that your emails have a compelling call-to-action that makes your subscribers want to click! If there’s not a good reason for users to be excited about going to your website, you’re going to have a low CTR.
There are many strategies for increasing your CTR, and we’ve just scratched the surface of this complicated topic. Whether you’re focused on display advertising or on optimizing the quality score of your search ads, you’re going to need to do a lot of experimentation to achieve a high click-through rate.
One thing that’s for sure is that you can’t just focus on your click-through rate—you also have to think about what happens once users arrive on your website.
If you’d like to make the most out of your click-through rate by personalizing your website for visitors arriving from your ad campaigns, sign up for a free OptiMonk account today!