What is click-through rate, and why does it matter?
Big picture, click-through rate is incredibly simple: it’s the rate at which people click on ads you’re showing them. You show and ad 100 times, you get one click, your CTR is 1%.
Easy peasy.
What’s harder to determine is what a good click-through rate is. Higher’s better, right?
Not necessarily, no.
Good CTR, a high CTR, means something good: people are attracted to your creative, your message, your placement, something about your ad. But that good thing can be a very bad thing if you don’t contextualize it with conversion rate, or CRV. A super-high CTR makes you feel like a superhero. But a super-low CVR means you’re attracting people who won’t install, won’t subscribe, or won’t buy … they won’t do whatever it is you want them to do after they’ve clicked on your ad.
And that just means you’re spending money on ego, and while your CTR is amazing, your ROAS … return on ad spend … is pitiful.
Good CTR is only good if it is accompanied by good CVR.
