A nice strong click-through rate (CTR) is a goal every marketer puts at the top of his list of KPIs to optimize for. It means your ad is relevant. It’s not only getting peoples’ attention, but it’s getting them to take action. That elusive click. It’s the ultimate goal of any ad strategy. Right?
Unfortunately, when I talk through ad strategy with some marketers or companies who are trying to build out their marketing strategy this click-through-rate is one of their main goals. And while a strong click-through rate is important, it’s really in my opinion a vanity metric that can be entirely misleading and potentially turn into a big waste of money.
Of course it all depends on your bidding strategy. If you’re bidding on a cost-per-click, as most SEM, PLAs and a lot of display ads do, every one of those clicks is costing you money. Which means that regardless of if the ad does you any good, it’s costing you.
Qualify Traffic Before You Pay for the Click
Here’s a secret: It’s not that hard to get high click through rate. There are a lot of tricks out there such as offering free samples, trials, false promises and even lies. Grabbing someone’s attention is easier than you might think.
But you know what’s not easy? Grabbing the right person‘s attention, and actually influencing their behavior in a meaningful way.
The thing you really need to focus on with any ads you create isn’t how many people will click, but instead how many qualified people click. This means thinking beyond what will take action and who you can get to bite, but instead thinking who your target market is that could be a customer and giving them an actionable ad that is part of a larger strategy – with a clear and focused goal at the end.
Let’s say, for example, you’re selling luxury handbags online. Your ads could focus that your “prices are up to 50% off” – but if you’re not a discount retailer and instead just have a small percentage of your catalog on clearance (so you technically do have up to 50% off – but those are the exception), you could see a strong click-through rate based on that perceived value by the customer.
But what you are also getting are a lot of bargain shoppers. Yes, they might be interested in your products but they are less likely to be interested in buying at full price. So you see a high click through rate, but little to no sales.
You’re spending a fortune on ads, and people are clicking … but you’re just burning through cash.
Now, take a look closer. Dive into your analytics. You’ll probably see that traffic from this campaign is seeing a low conversion rate, coupled with an extremely high bounce rate (or at least much lower time on site). This is because you’re not driving qualified traffic.
These are the instances you don’t want people to click on your ads.
But how do you fix it? What do you do to get qualified traffic that will convert to sales? Look at your ads and see what you can do to discourage unqualified traffic from coming through.
In the above example, it can be as simple as swapping out your copy to focus on other selling points. Or better yet, display prices directly with the product.
Tip: If you’re selling something that’s a download, include the word “buy” or”purchase” or a price in your ads. Many times people expect downloads to be free. By including a monetary component, you’ll eliminate a lot of the traffic that is just looking for a freebie – and not have to pay for them to come to your site and leave angry.
It may seem counter-intuitive at first, to try to get people to not click on your ads, but when your targeting options make it difficult to target based on user intent (are they even in-market to buy right now?), your ad themselves can really help you here.
The Ads Can’t Do All the Filtering
One caveat though: A lot of ad systems also look at your “relevance” as a factor in determining where and how often your ads display, as well as how much you might be paying for each click. So you still need to do the best you can with your initial targeting to put the ads in front of the best possible audience.
The ads still need to be relevant enough that the majority of those you put them in front of will be the target market. Otherwise your ads are either not going to display at all, or you’ll pay a fortune for every click you do have (this practice helps keep publishers happy, as they want the ads they display to complement their content and be relevant to their users).
When Can You Drive Less Qualified Traffic?
Just because a customer isn’t specifically in market to make a purchase doesn’t mean they can’t be. For our bargain shopper example above, there still is a chance that even if they were looking to save big on their new Coach bag, you could wow them with a product they want (and maybe you’re the only place with it in stock) and you can convert them to a sale.
It doesn’t mean you don’t want potential customers who might have low propensity to buy to come to the site. It just means you don’t want to pay a lot to have them come.
So when do you not want to limit your click through rates? When you’re not paying per click. In particular, in places like natural organic search listings. Your SEO strategy shouldn’t follow these same strategies – instead it should be focused on getting your site and pages to display in all the places that your potential customers might be. This includes keywords that might see a large percentage of searchers who aren’t in-market.
In these instances, you can afford to let the unqualified traffic into your site along with the qualified traffic. Just know that your conversion rate will likely be lower, and that this is okay.
For this reason, you’ll often see your Product Listing Ads (PLAs) be your best performing ads as far as click-to-conversion, followed by your standard paid search (SEM), followed by display ads, then last by organic search.
The Number To Focus On
If you’re not focusing on click-through rate, then what should you be focusing on?
Just remember that by conversion, it’s not always a conversion of a sale, but any event you’d call a success. This could be a lead generation, a share or like, a free trial or even setting a cookie so you can retarget them with another ad later.
But what’s most important is that you know what you’d call a success, mark it as some sort of conversion, and then optimize your ads so that each click is leading toward a conversion event. The higher you get this number (provided your conversion event goals are meaningful), the more effective your PPC ad strategy will be.