What is a click-through rate (CTR)?
The definition of click-through rate (CTR)?
A click-through rate (CTR) is the ratio of clicks to impressions on a mobile advertising campaign. CTRs are calculated by taking the number of clicks on a mobile advertising campaign, dividing it by the overall impressions and then expressing the resultant figure in percentage terms.
For example, if a company runs a mobile advertising campaign that generates 10,000 impressions and 500 clicks through to the App Store, the CTR of that campaign would be 5%.
Why are click-through rates important?
CTRs are a valuable way of understanding mobile advertising performance. By placing the CTR of one campaign in the context of other campaigns, it becomes possible to benchmark campaign performance. This can be done in a number of ways. CTR can be used to compare like-for-like performance of advertising creative in A/B testing, helping to identify whether certain creative features increase interactions.
CTRs can be used to compare the performance of different advertising channels. Comparing CTRs for banners, interstitials, video and other campaign types allows an advertiser to determine their effectiveness, helping to determine where to invest the bulk of a mobile advertising performance.
CTRs can also be used to some effect within the broader attribution funnel to vet user quality. By tying campaign performance to in-app behavior, an advertiser can discover whether a high CTR necessarily corresponds to increased user value. This can help advertisers tempted by channels offering high CTRs to identify whether they will offer high-quality traffic – or simply a high volume of users – and to adjust advertising investment accordingly.
Note that in some cases, a high CTR won’t always correspond with conversion rates, so it’s important to define your KPIs. For example, let’s say you have an e-commerce app and your most important conversion is a purchase event. You may notice in your analytics that Network A has a CTR of 10%, while Network B only has a CTR of 7%. However, Network A has a conversion rate of 5%, while Network B has a conversion rate of 20%. In this case, Network B has a better ROI, despite having a lower CTR.
Click-Through Rates and Adjust
The CTR of a single advertising campaign means little in isolation. On its own, a CTR tells advertisers nothing about how creative, channel, user quality and other factors (such as advert timing) affects performance. It’s essential to contextualize CTRs by looking at a broader data set. Comparing multiple campaigns across multiple channels will help to provide a more effective read on what is a ‘good’ or ‘bad’ CTR and will prevent advertisers from making decisions based on limited evidence.
Adjust helps advertisers to track click-through rates across campaigns with tracker links. By using Adjust’s tracker URLs and tracking architecture to assist with campaign measurement, advertisers can accurately measure the CTR of campaigns alongside one another - ensuring that the metric can be compared meaningfully.