The Single Most Important Number That Could Make or Break Your Business
July 27, 2007 by Gaman
After I’ve written the 8 unusual tricks to boost your AdSense CTR, an interesting discussion in the comments ensued where a reader suggested that as long as you have lots of traffic you’ll have clicks. In response, I wrote that CTR is more important than your traffic; higher CTR makes you more money with less traffic.
Another reader wrote, having a 5% CTR with 1000 visitors is better than 100% CTR from 10 visitors. When it comes to AdSense, common sense dictates that the more traffic you have the bigger your potential income would be. That I totally agree.
However, I think there’s one important number people tend to overlook in their quest to increase traffic and hopefully make more money from it. The number is your CTR itself.
Regardless of the amount of traffic you have, you can increase your AdSense income instantly just by improving your CTR. Having 10,000 users visiting your site daily doesn’t mean anything if it only generates an exciting 0.0001% CTR.
Here’s an example, let’s say you are making $0.10 per click from your AdSense. If you have 5% CTR with 1000 visitors per day, you’ll make $5 per day.
Now after reading my post, you start tweaking you pages and managed to raise your CTR to 10%. With the same amount of traffic, you are now making $10 per day.
Looking at it solely from the traffic level perspective, you’ll need to increase you daily visitors from the initial 1000 to 2000 to make $10 per day. While you might be able to double your traffic gradually over time, trying to do so instantly is next to impossible. That’s why at any moment in time, your CTR is more important than you traffic level.
If you want to improve your AdSense income right away, tweaking and optimising your AdSense units is the way to go. Getting traffic is important but it won’t happen overnight as most bloggers find out it’s extremely difficult thing to do.
If getting traffic to your site involved spending money on the pay per click search engines, it’s even more crucial to have better CTR on your AdWords ads since you’ll be paying for it. You’ll end up burning a hole in your pocket if all you want is traffic.
Here’s another example, let’s say your blog is about a very specific topic, for the sake of argument, let’s say it’s about Chinese glazed stoneware of Buddhist monks. With such a narrow topic, your blog would attract a very specific type of audience. There’s just so much traffic you could attract. Once you’ve reached the peak traffic level, the only way you could increase you AdSense income is to improve your CTR.
I often find this to be true when you are selling products or services from a website in a specific niche. You’ll get to a point where you find your traffic level reaches its peak and remains constant. The only way you could make more money is by improving your conversion rates.
The other day, one of my blogs made it into the digg.com front page. This has brought in a total of 42,856 unique visitors to the blog over the course of three days, a whopping 4200% increase in traffic from its normal level.
With such massive amount of traffic, one would expect it would have generated tons of money from AdSense. Unfortunately that wasn’t the case. It turned out that there’s no significant increase in my AdSense income during that period all because of the poor CTR.