This metric is relevant to a number of monetization strategies, including display advertising and affiliate marketing. In general, the higher the CTR, the better the overall monetization will be. This is (obviously) especially true for sites monetizing via CPC-based ad networks, where revenue is earned only when a visitor clicks on an ad.
The term “click rate” is synonymous with CTR.
Though CTR is most commonly used when discussing the performance of ad units, it can be applied to any call to action. For example, a site may want to measure the CTR on the various tiles in its nav bar, the CTR of links in an email newsletter, or the percentage of visitors who click on an “upgrade” or “sign-up” button related to a paid membership.
There are a number of factors that impact the CTR of ad units or other calls to action:
The Resources section below includes several links with suggestions for optimizing CTR.
Though CTR is usually discussed regarding ad networks, it is also very relevant for sites that monetize by selling ads directly. CTR is one of the key metrics that many advertisers and agencies will monitor to evaluate the performance of their campaign (though many now place a higher priority on CPC and CPA).
In this context, CTR measures how relevant your site is to their target audience; theoretically, sites with well positioned ads and a very relevant audience should see the highest click-thru rates.
A better measure of the success of an ad or other call to action may be visible CTR. This metric, which is currently challenging to calculate, would indicate the percentage of visible ad impressions that were clicked. For below-the-fold ad units–those that aren’t immediately visible when a web page loads–there may be a significant difference between the two. (For above-the-fold ad units, these two metrics should be nearly identical since all ad impressions are visible at least initially to visitors.)