CTR

CTR (abbreviated from Click Through Rate) refers to a number of clicks per hundred of impressions, expressed as a percentage. You can calculate CTR by dividing the total number of clicks by the total number of impressions and multiplying the result by a hundred to get a percentage. To be specific CTR measures immediate response to an ad, and not overall response to an ad, since some people may visit the advertiser's site at a later time as a result of seeing the ad.

Although considered as an advertisement effectiveness metric, it is only relevant to some aspects in internet marketing. Consider a CPM campaign at a flat rate $1.00 CPM, cost of displaying 1,000 ad impressions. CTR is extremely important to an advertiser, because it directly translates into the number of visits. At the same time CTR is of low importance to a publisher as the publisher is compensated based on impressions and not the number of clicks. Alternatively, when the campaign is CPC-based, the publisher is compensated on the number of clicks, and not impressions. In this case CTR is of great importance to the publisher and of low importance to the advertiser.

Generally the higher the CTR the higher the effectiveness of advertisement no matter which party is befitting directly.