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 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 CTR 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 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.
A click-through rate, or CTR, is basically the percentage of impressions that result in 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 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 ad clicked.
Okay, great – but so what?
The simplest answer is that ad platforms like Google and Facebook use 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 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 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 search 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 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 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 conversions 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 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 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 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, marketing professionals, agencies, startups, small businesses, and established enterprises to make PPC advertising a smooth, seamless experience that ultimately results in more clicks and conversions.
Want to learn more about whether we’re a good fit for each other? Let’s chat!