Click Improvement/Loss Calculator
What does CTR in Marketing Stand For?
CTR is an abbreviation that stands for Click Through Rate. It is one of the primary metrics that marketers strive to optimize since generally, the higher the rate, the more people are visiting the desired page.
In some situations, such as paid advertising, more ads can be purchased to increase the impression count, but there is no benefit if more people are not clicking the clicking the ad.
This can cause problems for advertisers, as many advertising platforms analyze relevancy and ad quality metrics.
As an advertiser, it is essential to strive for a high CTR as it will minimize ad spend and in an ideal advertising campaign, maximize the number of conversions.
Click Through Rate Formula
CTR = Number of Clicks / Number of Impressions * 100
It’s important to note that it’s not required to multiply by 100, as this is a conversion from a decimal to a percentage. Since most people are used to working with percentages, it is recommended.
These calculations can get a little more complicated when an advertiser is using a landing page, which they typically do.
When the user lands on a page coming from an ad; if they complete the desired goal, for the sake of clarity, that number is always called a goal conversion, even if the goal is to get the visitor to click a link on the page.
The goal conversion rate does not factor in ad impressions, but rather the number of clicks from the ad.
The number of landing page impressions is always equal to the number of clicks on the ad, minus some click loss, which can be caused by many different problems, such as server outages.
Most marketers would prefer not to factor the click loss into their calculations since they likely paid for those lost clicks.
To calculate the goal conversion rate, take the number of clicks on the ad and enter that into the above calculator in the impressions field, then put the number of completed goals into the clicks field, and press calculate.
What’s More important, High CTR or High Conversion Rates?
Every marketing campaign is entirely different, but generally speaking, the only thing that most marketers are concerned about is CTA (Cost to Acquire), and that number is usually referring to paying customers.
In most cases, the CTR and goal conversion rates must be optimized by split testing different variations to see what works better.
Since it can be challenging to convert a visitor into a buyer, many marketers choose to have simple goal conversions, such as a visitor entering the email address and opting into a mailing list.
These campaigns allow the marketer to generate a list of email lead data that they can send promotional emails to in the future.
Lead generation campaigns have proven over time to be very effective for the following reasons:
- The visitor entering their email address is the first step to creating an account.
- It’s much easier to get a user to enter their email address than it is to get them to enter their payment details. A conversion point with a high frequency of completion can drastically reduce the number of ads needed to determine if a landing page is performing better than another.
- It gives the marketer multiple opportunities to convert the email lead into a customer. It’s possible that they might buy something a year from the time they entered their email address.
- Send a nurturing sequence that helps gain the trust of the leads and helps them learn more about the brand.
- The cost to send promotions to an email list is much lower than it is to buy more clicks.
In this common use-case, the goal conversion is an email lead, and the conversion rate is determined as follows:
Conversion Rate = Number of email leads / Number of sales that those leads generated * 100
So, with this type of campaign, the conversion rate would be initially very low, but would likely grow over time.
With all of this data, the CTA can be determined and optimized.
The formula for CTA:
CTA = Ad Spend / Conversions
That process always starts with CTR optimization as it is the only metric that can be optimized early on in the campaign.