Marketing 101: Click-Through Rates
Click-Through Rates (also known as CTR) is a method by which the success of an online advertising campaign is measured. CTR is determined by dividing the ‘number of visitors who clicked on an ad’ placed on a webpage by the number of ‘impressions’ (the number times that the ad was delivered). The result is represented in percentages. If therefore out of a hundred (100) impressions of a banner ad, just one person clicks on it, the CTR would then be 1%. The popularity of banner ads has dropped and with them, the CTR. The average CTR for a banner ad these days is about 0.2-0.3% as against above 5% when the banner first began to appear.
CTR is not restricted to banner ads alone. It is also applicable to other means of online marketing campaigns like email marketing. In fact, the emphasis these days seems to be on the CTR in email marketing. According to Research firm Epilson, in the first quarter of 2009, 94.1% of marketing emails were delivered. Out of that number, 22% were opened by the recipients while 6.1% were clicked through. The report still rates email marketing high in spite of the oversaturation of email boxes these days. Various categories of the market had different CTRs though with general financial services having the highest CTR within the period reported while general business products and services ranked second followed by credit cards and banks. Clothing, publishing and media then consumer packaged goods and electronics ranked the least.
In measuring email marketing CTR, it is important to note that there is no single benchmark CTR. There are usually a host of factors considered in this regard. These include:
i. The audience the emails are sent to; whether business or consumer
ii. The relevance of the message to the audience
iii. The process for the email opt-in
iv. The frequency with which the emails are sent
v. Whether or not the emails are personalized
vi. The email list segmentation
vii. The number of links contained in the email
viii. The incorporation and placement of content within the email or otherwise
There are however certain averages that could be used for house lists which are permission based. These are as follows:
i. B2B Email Newsletters: Typically, the CTR for these range between 5-15%. If you do not get that much then you have to take another look at your content.
ii. B2C Promotional Email Campaigns: The CTR usually ranges between 2-12%
iii. Personalized Emails Lists: The CTR ranges between 10-20%
iv. Behavior-based Email Campaigns: The CTR ranges between 15-50%.
There ought to be cause for concern where the email marketing campaigns are indicating less than 2-3% CTR. The causes of these include:
i. Unclear opt-in process or inclusion without appropriate permission by the user
ii. Uninspiring subject lines resulting in prospects not clicking on the link
iii. Blocked or filtered systems that prevent your emails from getting delivered.
iv. Low open rates for the emails resulting in less prospects taking action