Click-through rate
Encyclopedia
Clickthrough rate is a way of measuring the success of an online advertising
campaign. The clickthrough rate of an advertisement is defined as the number of clicks on an ad divided by the number of times the ad is shown (impressions
), expressed as a percentage.
For example, if a banner ad is delivered 100 times (100 impressions) and receives one click, then the clickthrough rate for the advertisement would be 1%.
Click-through rates for banner ads have fallen over time. When banner ads first started to appear, it was not uncommon to have rates above five percent. They have fallen since then, currently averaging closer to 0.2 or 0.3 percent. In most cases, a 2% click-through rate would be considered very successful, though the exact number is hotly debated and would vary depending on the situation. The average click-through rate of 3% in the 1990s declined to 0.28% by 2003. Since advertisers typically pay more for a high click-through rate, getting many click-throughs with few purchases is undesirable to advertisers. Similarly, by selecting an appropriate advertising site with high affinity (e.g. a movie magazine
for a movie advertisement), the same banner can achieve a substantially higher CTR. Though personalized ads, unusual formats, and more obtrusive ads typically result in higher click-through rates than standard banner ads, overly intrusive ads are often avoided by viewers.
Online advertising
Online advertising is a form of promotion that uses the Internet and World Wide Web to deliver marketing messages to attract customers. Examples of online advertising include contextual ads on search engine results pages, banner ads, blogs, Rich Media Ads, Social network advertising, interstitial...
campaign. The clickthrough rate of an advertisement is defined as the number of clicks on an ad divided by the number of times the ad is shown (impressions
Impression (online media)
An impression is a measure ofthe number of times an ad is displayed, whether it is clicked on or not.Each time an ad displays it is counted as one impression....
), expressed as a percentage.
For example, if a banner ad is delivered 100 times (100 impressions) and receives one click, then the clickthrough rate for the advertisement would be 1%.
Click-through rates for banner ads have fallen over time. When banner ads first started to appear, it was not uncommon to have rates above five percent. They have fallen since then, currently averaging closer to 0.2 or 0.3 percent. In most cases, a 2% click-through rate would be considered very successful, though the exact number is hotly debated and would vary depending on the situation. The average click-through rate of 3% in the 1990s declined to 0.28% by 2003. Since advertisers typically pay more for a high click-through rate, getting many click-throughs with few purchases is undesirable to advertisers. Similarly, by selecting an appropriate advertising site with high affinity (e.g. a movie magazine
Film criticism
Film criticism is the analysis and evaluation of films, individually and collectively. In general, this can be divided into journalistic criticism that appears regularly in newspapers, and other popular, mass-media outlets and academic criticism by film scholars that is informed by film theory and...
for a movie advertisement), the same banner can achieve a substantially higher CTR. Though personalized ads, unusual formats, and more obtrusive ads typically result in higher click-through rates than standard banner ads, overly intrusive ads are often avoided by viewers.
See also
- Ad servingAd servingAd serving describes the technology and service that places advertisements on web sites. Ad serving technology companies provide software to web sites and advertisers to serve ads, count them, choose the ads that will make the website or advertiser most money, and monitor progress of different...
- Banner blindness Banner blindnessBanner blindness is a phenomenon in web usability where visitors to a website consciously or subconsciously ignore banner-like information, which can also be called ad blindness....
- Click fraudClick fraudClick fraud is a type of Internet crime that occurs in pay per click online advertising when a person, automated script or computer program imitates a legitimate user of a web browser clicking on an ad, for the purpose of generating a charge per click without having actual interest in the target...
- ClicktagClicktagA click tag is a parameter used in Flash banner ads. The parameter is a variable that defines the destination URL from the markup code. By using a click tag, the advertiser can easily see and modify the URL without a Flash developer....
- Cost per actionCost Per ActionCost Per Action or CPA is an online advertising pricing model, where the advertiser pays for each specified action linked to the advertisement....
- Cost per click
- Cost per thousand
- CPICost Per ImpressionCost per impression, often abbreviated to CPI or CPM for Cost per thousand impressions, is a phrase often used in online advertising and marketing related to web traffic. It is used for measuring the worth and cost of a specific e-marketing campaign. This technique is applied with web banners,...
- Impression (online media)Impression (online media)An impression is a measure ofthe number of times an ad is displayed, whether it is clicked on or not.Each time an ad displays it is counted as one impression....
- View-through rateView-through rateVTR is an estimation of the number of impressions viewed during the advertising campaign, ....
Further reading
- Sherman, Lee and John Deighton, (2001), "Banner advertising: Measuring effectiveness and optimizing placement," Journal of Interactive Marketing, Spring, Vol. 15, Iss. 2.
- Ward A. Hanson and Kirthi Kalyanam, (2007), Internet Marketing and eCommerce, Chapter8, Traffic Building, Thomson College Pub, Mason, Ohio.