If you’re using programmatic ads in your sales offerings, or for your own promotions, this is a common question. How do you know whether your click-through rate (CTR) is good? We turned to Charity Huff at January Spring for some insights into programmatic CTR.
Click-through rate is just one of many KPIs (Key Performance Indicators) used to measure ad views and actual clicks on the ad. The quality of the image and message, ad positioning, keywords, and many other factors will impact your CTR — including the platform you’re using and how diligent they are at preventing bot traffic and invalid clicks.
In addition to these many variables, there are audience considerations. For example, running a bottom-of-the-funnel campaign to known/repeat customers will likely generate high CTRs. Running a reach-based brand awareness campaign to a cold audience probably won’t.
CTR performance is also channel-dependent. Programmatic display delivers different engagement than paid search or paid social. Let’s break down each channel.
The industry programmatic click-through average is 0.08%. You can exceed that rate by optimizing at the tactical level (for example, keyword retargeting vs geofencing), and by designing your creative specifically for digital display. Don’t re-use or adapt a print ad! Display ads have to be designed with a single call-to-action and a straightforward message. Click-through rates also vary by industry.
Paid Search CTR
According to Wordstream, the average click-through rate on Google Ads (aka Ad Words) search network is 1.91% on search. Paid search tends to have a higher click-through rate than display advertising because the consumer is actively looking for the product or service for which they are searching. Search is considered direct response marketing, meaning that people click or engage with an ad in response to a specific need.
You can increase paid search click-through by pairing your search ads with display ads. This creates awareness for a business and its products or services with display that then translates into the consumer being more likely to click on a search ad from that same business because they “seem” familiar.
One last thing on paid search CTRs: rank still plays one of the biggest roles in earning a high CTR. If your ad is not in a high position, it likely won’t earn a good CTR. The sweet spots are positions 2-4. Not paying top-dollar, but not being buried “below the fold”.
Paid Social CTR
Does anyone else feel like everything with Facebook is a moving target these days? Historically, Facebook ads outperform Google ads. But these days, the CTR is all over the map. Pre-Apple iOS14 changes, we would have told you that a good CTR for paid social was 2%. Now, with the limited targeting data Facebook has access to and the reduced time they are assigning to conversion tracking, the performance has dropped off. This is where publisher first-party data targeting or using device ID targeting can save the day!
January Spring offers guidance and specific targeting programs to help your programmatic ads perform better than industry averages. Contact them for advice (we did!) and insights into the “Wild West” of online ads.