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What Click-Through Rate Should You Strive For?

What Click-Through Rate Should You Strive For?

Click-through rate, or CTR, is an estimation of the number of people who click on an ad versus the total number of people (impressions) the ad reaches. Check out our article to learn more about what is a good rate to strive for, as well how to calculate it.

Pay-per-click (PPC) advertising has a steady foothold on today’s best digital marketing strategies. Why? Because the advantages are plentiful.

PPC ads have the ability to hone in on specific demographics and searches, as well as deliver real-time performance metrics to help you measure and adjust the effectiveness of your campaigns. In short, it gives you more control for better results.

Google reported that Adwords users receive a two dollar average return on every single dollar spent on optimized campaigns. It’s a strong return on investment (ROI) that has made it a go-to tool for many businesses.

But in order to achieve these kinds of results, you have to have a solid strategy. This includes an efficient click-through rate that supports your desired ROI.

What is Click-Through Rate?

Click-through rate, or CTC, is a key indicator of how well your digital campaign is performing. However, before we dive into this term’s definition, you need to know the basics of PPC advertising metrics, including its terminology.

Below is a list of key terms used in measuring every campaign:

  • Impressions: the number of times your ad shows up in a user’s search
  • Bid: the maximum amount you are willing to pay per click
  • Daily Budget: the amount you are willing to spend per day on an ad
  • Campaign: a collection of ad groups sharing the same target and budget
  • Clicks: The action in which a user clicks on your ad
  • Click-Through Rate or CTR: a measurement used to gauge how effectively you’re reaching your target audience by averaging what percentage of impressions lead to clicks
  • Cost-Per-Click or CPC: the average cost of each individual click
  • Conversion: the act of a user following through on your ad’s call-to-action, whether it’s a form fill, call, purchase, or other desired action
  • Conversion Rate: the average of conversion based on how many clicks follow through with your call-to-action

While there are numerous other terms used within the realm of PPC campaign creation and management, these terms are essential to understanding your campaign’s performance.

Identify your CTR by dividing the number of clicks your ad has garnered by the number of impressions its had thus far. The number received from this formula is the percentage of impressions that have converted into clicks.

Simply put, it tells you how well your ad is performing. An ad that shows up often but rarely garners clicks isn’t performing well. This is typically due to poor keyword choices or a weak message or call-to-action.

The Click-Through Rate Benchmarks

So how do you know whether your click-through rate is good or bad? One great Adwords tool to help you gauge your performance is a feature called Google’s Quality Score Formula.

This simple 1 through 10 scale lets you know how relevant your ads are to the individuals whose search it shows up in. The more relevant your ad, the higher your score.

This rating takes into consideration how others ads in your industry are performing, so its a great way to gauge your success in comparison with your competitors.

However, it isn’t the only way to evaluate your campaign. There are other important benchmarks to consider, such as Cost-Per-Click (CPC), Cost-Per-Action (CPA), Conversion Rate (CVR), and, of course, Click-Through Rate (CTR).

All of these benchmarks are ones you should monitor throughout the course of your campaign. Waiting until the end of your campaign to evaluate its performance prevents you from reaching optimal performance.

One of the greatest advantages of PPC campaigns is their flexibility. You can update and tweak your ad groups, ad sets, individual ads, bids, and more throughout the course of its lifetime.

But how? What should you adjust in your campaign in order to increase its performance?

This answer is the core of this blog, and we dive deep into it below.

How to Improve Your Click-Through Rate on Adwords

If you want to reap excellent results from your PPC campaign, you’ll want to do pay attention to three key elements: targeting, message, and keywords.

Identify Your Target Audience

Who you target is essential to your ad’s performance. Know your core audience.

What are their needs?

What attracts them to your product?

How do they prefer to communicate?

When you know the demographics and nature of the people you are advertising to, you can identify the best way to communicate with them. This is why it’s the first step and a very important one.

Craft Relatable Ad Copy

After you identify your audience, you can start to craft your message. Ad copy should speak to the user on a personal level.

Don’t hard-sell your product or service. Instead, talk to your customer in a way that connects with them on a personal level. Express empathy and provide a solution.

Establish and Maintain the Right Keywords

Last–but far from least–is building and managing your keyword list. Every campaign has a unique set of keywords that tells Google where to place your ad.

This list is constantly evolving as your campaign runs, which means it requires steady maintenance. Pay close attention to the keywords you input, as well as the keywords you acquire.

Ask yourself:

  • Are they relevant to your product and service?
  • Do they align with search terms users would use while searching for your product or service?

Never, ever fall into the habit of keyword stuffing. Quality is better than quantity. Zero in on the words and phrases that make sense and weed out the ones that don’t.

This will directly improve your ad’s performance by ensuring you don’t waste impressions on useless or irrelevant search results.

Improve Your ROI with PPC Management Service

Are you ready to improve your click-through rate and your ROI, but you don’t have the time or expertise to do it yourself?

We get it. Managing your digital campaigns is a full-time job. Sometimes it’s better to hire a third-party vendor to take the reins for you while you focus on running the business you know best.

Talk to us about our Google AdWords Management Service. As Google Partners, we have the certifications and tools to drive your campaigns to success.

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