Categories
If nobody sees your ad, how many people do you think will click on it? Not too many, right?
In advertising, the theory is that clicks lead to conversions, and ultimately, those conversions lead to higher profits and a better return on investment (ROI) for your marketing campaigns. So, it seems pretty obvious that to get more clicks, your ads need to reach more viewers.
Recent research found that ads in the top position in Google’s search engine results pages (SERP) receive a lot more clicks than ads in lower positions.
In this article, we’ll look at the link between CTR and average position. By the end, you’ll understand just how critically important it actually is.
In pay-per-click (PPC) advertising, the click-through rate (CTR) is the percentage of viewers that click your ad. It is calculated as follows:
CTR = (total number of clicks / total number of ad impressions) * 100
Click-through rate is a key metric in PPC advertising, and definitely one that you should be tracking to gauge the success of your ad campaign.
A high CTR is a great sign of ad relevance. It means your ads are resonating with the target audience, as they find the copy and the offer interesting and engaging enough to click on.
This key metric is a sure-fire sign that your ads are connecting with your target audience. So, it should come as little surprise to learn that, in PPC advertising, marketers should strive for a higher click-through rate.
Going beyond ad relevance, here are several major benefits of a high CTR:
Achieving higher conversion rates is the ultimate goal of every business, as it leads to bigger profits. With more clicks, your ads will generate more traffic to your site, thus increasing the chances of conversions.
Quality score and click-through rate are intrinsically linked, which in turn has an impact on your ad’s position in paid search results.
Google uses the quality score of your ads to determine their position. As mentioned already, a higher CTR is indicative of ad relevance. So, if your ads are more relevant to viewers, they will be awarded a higher quality score.
When bidding on keywords, you can set a maximum bid that you are willing to pay. If someone enters a search query containing your keyword, Google will calculate an ‘Ad Rank’ for your advert.
Ad rank is a key factor in determining where your ad is displayed in the search results, and also impacts how much you will pay for the ad.
The link between CTR and average position comes in here, as a higher click-through rate will invariably improve the Ad rank.
In PPC advertising, there is an inverse relationship between quality score and the cost-per-click (CPC). This paves the way for one of the best benefits of a high CTR.
With a higher clicks performance, you will benefit from a higher quality score, which in turn leads to a reduction in the CPC of your ads.
The answer to this question really depends on a few factors, such as your industry, products, and audience.
However, just to give you an idea of what you should be working towards, here are some decent benchmarks for ads with a quality score of 7 or above:
You can clearly see the link between CTR and average position here. The lower the ad position, the lower the CTR.
Just dropping from position #1 to position #3 can cause the CTR to drop by more than 50%. This could potentially result in a massive loss of traffic to your site, which can hit your ROI hard.
After the top five positions, the click-through rate fades out as fewer viewers bother to scroll that far down the page.
In paid search, the link between a high CTR and average position is undeniable.
When your ads are displayed in a higher SERP position in Google, more people will see them. As more people see them, the likelihood of them being clicked on increases exponentially.
This is especially true if your ad copy and offer are engaging for your target audience. If that’s the case, then your ads will generate more clicks.
The benefits of a high CTR are not to be underestimated. A surge in clicks performance can affect a domino-like impact of positive change on key metrics in your ad campaign.
A higher CTR lets Google know that your ad is more relevant. This higher ad relevance will lead to an improving quality score, and relevant ads with a high-quality score will be rewarded with a higher ad rank, which causes CPC to fall.
Ultimately, a higher CTR delivers more conversions, more revenue and a greater ROI for your marketing campaign. While the click-through rate is not the only influence on your ad’s success, it is most definitely one of the biggest factors.
Therefore, you should always monitor the CTR of your ads closely and constantly look for ways to improve your CTR in PPC advertising.
How much did you enjoy this article?
We will help your ad reach the right person, at the right time
Actionable insights discovered for you. Now you can do more in less time.
PPCexpo Keyword Planner will help you align your keywords with the customers’ intent.
Frequent audits will help you optimize your PPC campaign for success.
Visualizations give you the ability to instantly grasp the insights hidden in your numbers.
Experience the new revolution in reporting … click your way to insights, don’t scroll.
Calculate the number of combinations in your PPC campaign. It may surprise you.
Related articles
A landing page is a web page designed to drive specific actions. Learn the essentials of creating high-converting landing pages in our guide.
ROAS calculation can help you evaluate every PPC campaign's performance so that you know which of your campaigns are converting the best.
Discover the marketing lifecycle stages and how they shape customer relationships. You’ll understand their role in driving customer engagement and retention.
