Optimizing click-through rate (CTR) is one of the best ways to measure the effectiveness of your advertising campaigns. By definition, CTR is the number of users who click on a specific link compared to the number of total users who view a page, email, or advertisement (thanks, Wikipedia!). While the metric seems simple on the surface, it gives valuable insights into areas of future growth and improvement. We'll take you through how to calculate this metric, how to understand it in the context of your industry, and how to apply it to the platforms you're using now.
You can calculate CTR by dividing the number of click-throughs by the number of impressions. CTR can be assessed for various time-periods (i.e. day, week, month, year) and, if your click-throughs are tied to certain products or campaigns, you can assign a specific CTR for each.
If you’re confused about how to define click-throughs and impressions, we’ve included some nifty definitions and examples below:
When choosing what to include in your calculations, remember: consistency is key! That means, if you decide to include XYZ in your CTR for the month, you should include it in the next month’s CTR as well. Having consistent metrics will allow you to better identify the causes of good or bad performance. For instance, if the number of impressions of your ad has increased but your click-through rate is still low, there is something that you have to improve or change in your advertisement.
While CTR is easy to calculate, it’s important to keep in mind that CTR is one of many valuable metrics to track your performance. If you don’t want to spend hours at the end of the month juggling numbers from your Google Analytics, Facebook, Mailchimp, and LinkedIn accounts, consider trying Lido. Lido can help you build a dashboard to monitor your data and give a look into how your key metrics (such as CTR) change over time.
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