What is CTR - Vine Street Digital

The Who, What, When & Where of CTR

The Who, What, When & Where of CTR

As a business owner, you probably don’t have time to learn every technical detail of your online advertising. After all, you’re a business owner, not a full time online marketer. The same is true of marketing managers in bigger companies. Your job is to lead the overall vision and plan for your marketing, not to micro-manage every aspect of this yourself. What you do need, is information that will help you with your overall business and marketing strategy.

CTR is one of those metrics that will get talked about a lot, and you’ll often see it in reports. When your CTR falls, people are often quick to point to the ad copy, but that’s not the only thing that could be impacting it. You can get a lot of insight from your CTR metrics about your business, your offering, your customers and your sales funnels. It’s not just an indicator of whether your ads are good or bad.

Today I want to talk about CTR to give you an understanding of what it truly means to your business, so that it’s not just another number that goes up or down.

What Is CTR?

CTR stands for “Click-Through Rate”. In a nutshell, it’s the rate at which your ad appears vs the number of times it is clicked. For example, if your ad shows 100 times and one person clicks on it once, you’d have a click-through rate of 1%.

There can be other names for this and other definitions. You might see it called “interaction rate”. Other variations of CTR depend on how you define “your ad appearing” and “a click on your ad”. For the purposes of this article, we’ll keep it simple and just talk about click-through rate as the number of times your ad shows vs the number of times it’s actually clicked.

Factors That Influence CTR Performance

What

There are lots of reasons why your CTR may be going up or down. Knowing these reasons can help you make decisions about your future marketing plans.

The first factor in CTR is obvious – what people are seeing.

If your CTR is falling, it could be because of the actual ad itself. Perhaps it’s not connecting with the customer enough, or addressing their objections well. Maybe you’re advertising a price and people aren’t understanding the value of what you’re selling, just from looking at the ad. Maybe it doesn’t communicate that you can offer what they’re looking for or help them with their needs and wants.

For example, let’s say you run a cleaning company. If someone searches for “move out cleaning” and your ad is a generic ad that says…

“Cleaning services – over 20 years experience. Get a free quote now.”

… then it’s not necessarily a bad ad. A lower CTR in this case might mean you’re not addressing the person’s concerns. For example, they might be wondering:

  • Will I get my deposit back?
  • Do you even do move out cleaning jobs?
  • How much does it cost?
  • What’s included?
  • Etc.

If you’re a business owner and you see CTR going up or down, definitely look at what you are saying in your ad – it could help you better communicate your value, and understand your customers further.

WHAT
Does it connect with the customer?
Does it answer their objections?
Does it communicate value?
Does it confirm that you’re what they’re looking for?

TAKEAWAY FOR BUSINESS OWNERS
Understand what wording customers respond to.
Understand key objections you’ll need to handle.
Understand customers needs.

Where

The second factor is where people are seeing the ad.

You could have the best tried-and-tested ad copy in the world, but if it’s showing it in a place that’s hard to see, then you won’t get a great response. Maybe the ad is coming up on the right hand side (on a desktop computer) and it’s not catching anyone’s attention there. Maybe you’re running banner ads and your ad is appearing down the bottom of the page – even though your ad is present, it still might not be seen if the user doesn’t scroll down far enough.

Another concern is: what else is going on on the page? Your ad might be front and centre at the very top, but if your ad offers “20% off” whilst the ad next to it says “30% off”, then you’re going to have trouble winning the click. If you’re running banner ads on a very noisy website that has a lot of content on it, you may find it hard to compete with so much else going on. The same is true on Facebook – people on social media are looking at lots of different content. What your ad appears next to can affect whether or not someone sees it as important.

For a business owner in these situations, your CTR can be an indicator of:

  • Where it’s best to reach your audience,
  • Whether your ads are being selected over your competitors’ ads, and
  • Understanding that ads showing in different places might need different wording to catch attention.

WHERE
Can people see your ads?
What ads are they appearing next to?
What are your competitors saying?
What else is happening on the page?

TAKEAWAY FOR BUSINESS OWNERS
Knowing whether or not your offer is competitive.
Knowing if you’re communicating value over your competitors.
Knowing what platform is the best way to get the attention of your customers.
Understanding that ads in different places might need different messages.

Who

Another aspect of CTR is who is seeing your ad.

You might have a great ad showing in a great place, but if it’s showing to the wrong person, it’s not going win the clicks. For Google Ads, this might mean that your keywords are triggering for searches that are irrelevant and you’re getting impressions that aren’t quite right. For social media ads, it might mean that your audience isn’t refined enough, isn’t hitting the right people, or excludes people that could be more relevant. As a business owner, CTR can be indicative of whether you’re actually getting to the right people and, even if you are, if you’re also getting to the wrong people at the same time. CTR can indicate the extent to which you’re reaching the right people, and also be a step in evaluating why someone is the wrong person.

WHO
Is your ad getting to the right people?
Is your ad showing up to the wrong people?

TAKEAWAY FOR BUSINESS OWNERS
Who is interested in your business?
Who isn’t interested in your business?
The usual profile of your customers.

When

Finally, CTR can be reflective of when your ad is showing to someone.

Behaviours of customers can be very different depending on if it is first thing in the morning, during the day, or late at night. If someone is on Facebook right before they go to sleep, they might see an ad and be genuinely interested, but not bother clicking on it because they know they can’t act on it right now. Different audiences will also have different schedules, and peak decision-making times are going to vary (for example, think of a working mother’s timetable vs that of a young university student).

The “when” of an ad can also relate to when someone is ready to act based on how far along they are in their decision-making process. For example, if someone types in “sell my house” and your ad is for real estate agent services, you might think that person is relevant and your ad might be great. However, if that person is just considering whether or not to sell their house, maybe they are not yet ready to act, and are only looking for articles or opinions at this stage.

As a business owner, CTR can give you an idea of the times and days your customers are most likely to want to explore your offer, as well as their readiness to act. It can also help you trial copy that’s less intimidating – maybe instead of “contact us now” you need to test out “find out more”.

WHEN
Is it the right time and day for your ad to be effective?
Are people just beginning to explore their options or ready to act?

TAKEAWAY FOR BUSINESS OWNERS
Behaviour of your customers.
How long it takes a customer to make a decision.
How to catch people ready to go vs those just browsing.

Wrapping Up

To recap, business owners need data to make decisions about their business, customers and sales processes. Looking at a CTR going up and down isn’t helpful unless you explore the “why”. With so many different factors relating to CTR, there isn’t necessarily a “good or bad” CTR that applies to all situations. A good marketer will work with you to learn about your business and your customers to test out a lot of these variables and keep improving. They’ll also work with you to communicate why something is working and why it might not be. If you take away just one thing from this article, it would be that all stats need to be in context and contribute to a bigger picture.

If you want to speak to someone about interpreting your data or your paid advertising in general, get in touch and we’d be happy to help.

Written by Gemma Renton