In order to get a positive return on investment with your pay-per-click (PPC) ad campaign, you need to pay attention to the numbers.
That’s really all PPC Online advertising is – a numbers game. And if you get the numbers right, you win.
But which numbers matter most? And how can you boost those numbers as much as possible to increase your success and revenue?
Well, it all starts with a good click-through rate (CTR).
In this article, we’re going to dive into the nitty-gritty of what click through rate is, why it’s important, what percentages you should be aiming for, and clever (somewhat random) ways you can get better results.
Let’s go all the way back to the basics and dig into what the Average click through rate(CTR) metric represents, how to calculate it, and all of the basic 101-level information that usually gets glossed over.
If you already know this stuff, great – consider it a quick refresher (or move on to the section below on benchmark PPC CTR rates). If you’re totally new to the PPC game, then this will give you a baseline understanding so that everything else we’re about to discuss will make sense.
So, without further ado, let’s get into the definition.
An Average click through rate(CTR), is basically the percentage of impressions that result in total number of clicks. In order to calculate this number, you simply take the number of clicks and divide it by the total number of impressions (people who saw the ad). Then you multiply that number by 100.
For example, let’s say your online ad got 5,000 impressions and 75 people clicked. The equation would look like this:
(75 / 5,000) x 100
The result is (.015) x (100). This comes out to 1.5 percent. This is your click-through rate. It means 1.5 percent of people who saw your online ad clicked.
Okay, great – but so what?
The simplest answer is that the click-throughs on paid ad platforms like Google and Facebook use Average click through rate CTR to quickly evaluate the health and value of an ad. If lots of people are clicking, then it tells the algorithm that this is an attractive ad that’s making them lots of money. And if the ad is making them lots of money, they want to make sure you keep serving the ad. This leads them to lower the cost per click (CPC) as a way of incentivizing you to continue online advertising on their network.
In the case of Google Ads management,(CTR) also impacts something known as a “Quality Score.” This score is awarded on a 1-10 scale and is determined by a mixture of factors like Average click through rate(CTR), landing page UX, and ad relevance.
An ad’s Quality Score impacts its “Ad Rank,” which Google uses to determine where ads show up on search results. A high CTR leads to a higher Quality Score, which in turn leads to a higher Ad Rank. This ends up putting your ad in front of more of your target customers at a lower price.
If that’s all a bit confusing, here’s a simple visual to make it easier:
CTR → Quality Score → Ad Rank → PPC Ad Placement → Higher CTR
It’s basically a self-feeding cycle. As your CTR increases, so do all of the other metrics. This usually leads to a higher CTR, which…well, you get the picture.
Once you understand what (CTR) is and why it’s important for PPC ads, the next logical question is, what’s a good click-through rate?
The answer is…it depends!
I know – that’s not the answer you’re looking for – but we’re going to take a deeper dive in just a moment. The point is that there’s no concrete figure. There are dozens of circumstantial variables that come into play based on your product, industry, creative, and the PPC platform (Google vs. Facebook vs. Others).
When evaluating baseline PPC CTR, there are a few quick factors you can take into account right from the start. This includes (a) how the ad is being displayed, and (b) the industry you’re in.
Let’s start with how the ad is being displayed. With Google ads, there are two different networks. You have the Google or other search engines network and the Google display network.
The search network includes text-based ads that pop up within Google search results (at the top and bottom of the page). The display network serves ads on other websites. These are typically image-based ads and banners.
Google search network ads tend to have a slightly better click through rate(CTR), simply because they appear within the search results. Averages across all industries are usually somewhere in the 1.75 – 2.00 percent range.
Ads in the Google display network are usually much lower – somewhere south of 0.50 percent. (This is due to the fact that many users use ad blockers and other plugins that make it less likely they’ll even see the ad.)
When it comes to the industry, the average click through rate(CTR) can change dramatically from one sector to another. Here are some examples pulled from recent reports:
As you can see, the standard from industry to industry is different. Achieving a 4 percent CTR in dating and personals might be extremely low, whereas it would be an incredible rate in technology. This just goes to show there are a lot of unique factors in play.
Even within specific industries, averages vary based on the offer, type of product, brand, etc.
The fact that click-through rates vary so much can actually be viewed as a good thing. It means you always have the ability to increase your numbers. And, sometimes, all it takes is a little creativity.
Now that we have some basic context established, let’s dig into the juicy stuff. How can you improve your PPC click-through rates so that you stand a better chance of producing conversion rate and increasing revenue?
Here are several suggestions:
Humans have a wide range of emotions. And while we like to assume that we’re fairly rational creatures who make logical decisions after having all of the facts laid out for us, the truth is that we typically act on emotion (then justify with logic after the fact).
As an advertiser, you can use this little bit of knowledge to your advantage. Avoid the logical plea and get emotional. Ethically leveraging love, fear, hope, belonging, shock, and surprise can help you get better click-through rates.
For example, let’s say you’re running an ad for roses during Valentine’s. Leading with something like “2 Dozen Roses for Just $29” is actually a fairly weak hook. You might make a few sales, but there’s nothing other than price at play. What about all of the buyers who are less price sensitive?
A better ad might read: “She Thinks You Forgot. Roses Delivered Same Day.” Do you see how much better this ad copy is? It makes an emotional appeal – not just a logical dollars and cents pitch.
Questions can be powerful when used appropriately in your PPC ads management. People are naturally curious and posing the right query can get people thinking about things through whatever filter or context you’d like.
When asking questions, try wording them in a way that the answer is obvious. (Not only that, but the answer should be obvious and certain to push them closer to clicking.)
Going back to our roses example, you could do something like this: “Miss Her Birthday Again? 2 Dozen Roses Will Do The Trick.”
Or if you’re a financial advisor: “Unprepared for Retirement? Learn How to Create a Guaranteed Stream of Income in Your Golden Years.”
A good question can save valuable space in your ad by letting your prospect tell themselves why they should click. This can be more powerful than using a direct command.
Humans have a huge, oversized fear of missing out on something. You might even say this is a distinctly human trait. Dogs don’t see other dogs walking with their owners as the sun goes down and think to themselves, “No! I hope I don’t miss out on a walk with my owner before the sun sets!” Now, if you tell a dog that you’re going on a walk, they might get really excited. (And they might even get sad if you’re then unable to take them out.) But they don’t have a fear of missing out.
With humans, we’re constantly fearful of being left out or missing the boat. In many cases, we’ll do anything to avoid this feeling – even if it means spending time or money on something we might not truly need.
In advertising, you can tap into FOMO by creating urgency and/or playing the scarcity card. You can do this by setting a deadline for a sale, releasing a limited order quantity, or using some sort of tiered discount based on when people place an order.
While not perfect for every brand, humor can be a very useful mechanism for increasing click through rate(CTR) and getting a better response. Having said that, it’s a somewhat risky play – simply because everyone has a unique sense of humor. You could easily miss the mark and drive your click through rate(CTR) close to zero.
If you’re going to attempt humor in your ads, we recommend running multiple variations. Have a humorous version and a non-humorous version and split test the same ad creative. This will give you a pretty good feel for the response. After gathering enough data, you can make a decision on whether to move forward with the funny ad or nix it.
We can talk all we want about ad creatives, copy, and other elements, but it all comes down to ad-audience fit. If you aren’t focusing on the right audience, you aren’t going to have high CTRs.
For Facebook in particular, where you have a massive amount of control over your audience, niching down to a very specific part of the market is going to give you the ability to create much more targeted ad copy and images that resonate.
For example, don’t just target business owners. Target restaurant owners. And then split your ad campaign up so that you can target South Carolina restaurant owners and California restaurant owners separately. This gives you so much more relevancy and control.
One school of thought says you should max out your ad by using every single character you’re allowed to use within the character limit. But is this really the best way to go?
There’s ample research to suggest shorter ads (particularly on Facebook) get more number of clicks and better engagement. In fact, as character count increases, response rates steadily fall off.
The fact that shorter ads do better is likely due to the fact that people have very small attention spans. An ad that can be consumed in three seconds is much more enticing than an ad that takes 90 seconds to read. Even if your copy is great and you can effortlessly compel people to read sentence after sentence with mouth-watering copy, there’s simply too much friction to attract a large percentage of your audience. Keep it short!
When dealing with Google display network ads and/or Facebook ads, the image is the most important part. People will process the image long before they read the copy or call-to-action. So when you run an ad, always split test at least three different images. This will give you a feel for what your customers respond to best.
PPC is both an art and a science. It requires equal parts creativity, technical competence, and experience. If you’re lacking in any of these three areas, you aren’t going to get the sort of results you need.
But there’s good news: We can help.
At PPC.co, we partner with entrepreneurs, digital marketers & email marketers/ email marketing professionals, agencies, startups, small businesses, and established enterprises to make PPC advertising a smooth, seamless experience that ultimately results in more clicks and conversion rate.
Want to learn more about whether we’re a good fit for each other? Let’s chat!
%201.svg){kind=logo}
When this apartment complex client partnered with PPC.co, their goal was clear: generate more qualified leads through Google Ads. In just 60 days—from January to March 2025—we transformed their paid acquisition performance. Total conversions more than tripled, jumping from 10 to 32, while the overall conversion rate soared by over 300%. At the same time, we drove down the cost per conversion by 44%, delivering significantly more leads at a much lower cost.
By strategically combining Performance Max and high-intent Search campaigns, we not only increased lead volume but improved overall efficiency and ROI. This rapid and measurable improvement underscores the value of data-driven optimization and expert campaign management.
This case study is a testament to what can happen when a well-structured campaign meets expert strategy and continuous optimization. Whether you're launching a new property or looking to boost occupancy in a competitive market, PPC.co delivers real results—fast.
Ready to grow your leads and lower your cost per conversion?
Contact us today to schedule a free audit and discover how we can help you achieve similar results.
Click on the following link if you would like to see more PPC case studies!
If you’re running an e-commerce or retail business, you already know that visibility is everything. The best product in the world won’t sell if no one sees it. That’s where paid ads for ecommerce comes in.
Done right, they drive traffic, conversions, and repeat customers.
Done wrong, they drain your budget and leave you wondering what went wrong.
Whether you’re spending $500 a month or $50,000, your goal is the same: profitability. Not just clicks, and certainly not just impressions. You want to turn ad dollars into real, predictable revenue.
So how do top-performing e-commerce and retail brands make their paid ads work?
What are they doing that you’re not?
This guide breaks it down step-by-step, so you can start running profitable ads with confidence.
Before you launch a single campaign, you need clarity on your audience and goals. Are you trying to boost first-time sales? Increase average order value? Each objective requires a different strategy and metrics for success.
Don’t fall into the trap of launching ads just to “see what happens.” Paid media works best when it’s part of a bigger strategy. So before you log in to Google Ads or Meta Ads Manager, get specific about what success looks like.
If you want to run profitable paid ads, knowing your numbers is the foundation of your entire strategy. Without a clear understanding of your margins, break-even points, and how much you can afford to spend to acquire a customer, you’re essentially gambling with your ad budget.
And in e-commerce, that can get expensive fast.
Let’s start with the most critical numbers you need to know:
Your break-even ROAS tells you the minimum return you need on your ad spend to not lose money. It’s calculated by dividing 1 by your gross profit margin.
So if your margin is 50 percent, your break-even ROAS is 2.0. That means for every $1 you spend on ads, you need to make $2 in sales just to break even.
For example, let’s say you’re running Facebook Ads and spending $1,000 on a campaign. If your break-even ROAS is 2.0, you need to generate at least $2,000 in revenue to avoid losing money. Anything above that is profit. Anything below that eats into your cash.
Once you know your numbers, you can reverse-engineer your ad strategy instead of throwing money into the void and hoping for results. For instance, if your AOV is low (say $25), you might struggle to profit from ads unless you have a very low COGS or high conversion rates. In that case, you might want to:
On the other hand, if your AOV is $150 and your margins are strong, you have more room to compete in ad auctions, bid more aggressively, and test multiple audiences and creatives without instantly wiping out your profit.
A lot of beginner advertisers focus entirely on immediate return from ads. That’s understandable – but short-sighted. If you’re breaking even or slightly losing on the first sale, that might still be a smart move if you’re building long-term customer relationships.
That’s where Customer Lifetime Value (LTV) comes in. If you know that your average customer places three orders a year, each worth $60, then their LTV is $180. If you spend $40 to acquire that customer with your first ad, but earn $140 more over the next 12 months, that ad was extremely profitable in the long run.
Top e-commerce brands build their paid strategies around LTV-to-CAC ratio – how much they earn over time compared to what they paid to acquire the customer.
A healthy ratio is usually 3:1 or higher. So if you’re spending $50 to acquire a customer, you want to earn at least $150 from that customer over time.
Once you understand your numbers, you can plan your ad spend with precision. You’ll know exactly:
Let’s say you want to make $5,000 in profit this month, and your product has a 50 percent gross margin. That means you need $10,000 in sales. If your target ROAS is 2.5, you can spend up to $4,000 in ad spend to hit that goal. With those numbers in hand, you now have a roadmap for campaign budgeting, not just a shot in the dark.
Every ad platform has strengths. But if you try to use them all at once, you’ll burn through your budget without learning much. Instead, pick one or two that align best with your business model and customer behavior.
If you’re selling visually appealing products like apparel, skincare, or home goods, platforms like Instagram and TikTok can deliver strong returns – especially with the right creative. If you’re focused on high-intent buyers, Google Search and Shopping Ads are goldmines. And if you’re targeting professionals or B2B retail buyers, LinkedIn may offer surprising results.
Test channels strategically. Start with the one that matches where your customers spend their time and scale from there. The best platform for you is the one where your ideal customers are already shopping, scrolling, or searching.
One of the biggest mistakes retailers make is casting too wide a net. You don’t want everyone to see your ad – you want the right people to see it.
On Google, this means targeting high-intent keywords that signal buying behavior. Focus on terms like “buy,” “best,” “free shipping,” or product-specific searches. On Facebook, Instagram, or TikTok, you’ll want to dial in your custom audiences using demographic data, lookalikes, interests, and behavior.
Don’t forget retargeting. Most people won’t buy the first time they visit your site, but retargeting brings them back when they’re ready. Set up ads that follow people who viewed a product, added to cart, or engaged with your brand but didn’t check out.
The more relevant your targeting, the more efficient your spend and the higher your return.
Creative is the make-or-break factor in most e-commerce ad campaigns. You can have perfect targeting and the right product, but if your ad doesn’t grab attention in the first two seconds, it won’t convert.
Your creative needs to do three things quickly:
Use high-quality product photos or videos. Show your product in action. Highlight a clear benefit or solve a specific problem. Incorporate customer reviews or user-generated content to build trust.
For paid social, test multiple creatives at once – video vs. image, UGC vs. branded, short-form vs. long-form – and let performance data guide your iterations. On search platforms like Google, focus on copy that’s compelling and packed with relevant keywords. Test different headlines and descriptions to see what gets the best click-through rate.
Sending paid traffic to your homepage is a rookie mistake. You want every click to land on a page that’s designed to convert. That means fast load times, mobile optimization, and a clear call-to-action.
If you’re promoting a specific product, send users to that product page and not your full catalog. If you’re offering a bundle or a seasonal deal, create a dedicated landing page with copy, visuals, and layout tailored to that offer.
Remove distractions. Reduce friction. Make it stupid-easy for people to buy. The less effort it takes, the more sales you’ll see. And don’t forget to A/B test. Sometimes a simple tweak to your headline or CTA can double your conversion rate overnight.
Once your ads are live, your job isn’t done. In fact, this is where it really begins. You need to monitor performance regularly, looking at more than just the surface-level metrics.
Click-through rate (CTR) tells you how well your ad is capturing attention. Conversion rate shows how well your landing page is sealing the deal. ROAS tells you how profitable your campaign is. And CPA helps you compare efficiency across different products or audiences.
Watch for early indicators of success – or failure.
Treat your campaigns like living systems. Tweak, test, and improve them continuously.
Once you find a winning combination – an ad, offer, and audience that works – it’s time to scale. Increase your budget gradually while keeping an eye on performance. Scaling too fast can tank your results, so go step by step.
Duplicate high-performing campaigns to test new audiences or creatives. Experiment with upsells, bundles, or time-limited offers to increase AOV. Layer in email or SMS marketing to retarget paid traffic and drive repeat sales.
And just as importantly, don’t be afraid to kill underperforming ads. If something isn’t working after a reasonable test period, cut it. Your budget should be flowing to what works – not what you hope will work.
One of the biggest mistakes in paid advertising is chasing one-off sales without thinking about the bigger picture. Winning e-commerce brands think in terms of customer lifetime value.
If your first sale breaks even, that’s fine. (As long as you have a plan to turn that customer into a repeat buyer. ) You can use post-purchase emails, loyalty programs, and retargeting ads to bring people back.
At the end of the day, when you view paid ads as the beginning of a customer relationship – not the end – you unlock real long-term profitability. And at PPC.co, that’s where we want to help you! We offer industry-leading PPC management services for ecommerce and retail brands who want to stop wasting ad spend and start generating real ROI.
Contact us today to learn more!
