The Single Most Important Number That Could Make or Break Your Business

July 27, 2007 by  

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 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.

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Comment by wandira
2007-07-27 23:39:03

CTR is also depending on the audience of the blog right ? So that’s why when you got dugg with 4200% traffic increase, no CTR increase you got, since most visitors came from digg are tech-savvy. Btw, your post enlighten me as usual, many thanks.

Comment by fayz
2007-07-29 03:43:47

people that came from digg not necessarily tech savvy..digg have several categories..for gaman’s blog it could be someone who is a newbie casually browsing in a tech category on how to make more money from adsense..

2007-07-28 01:10:23

Click through rate is important, I think some people tend to forget that. Also, I think some people are of the belief that a CTR should be an average or low number – like 2-3%. Honestly, adsense ads are soooo targeted, that if you are doing a good job on the layout of your blog my personal experience is that you can get a much higher CTR. This depends on the placement of the content in relation to the ads, and the keywords in your articles of course.

On some of my blogs I have achieved CTR’s as high as 10-12% which sustained for many days. CTR to your web site is the same as Return on Investment (ROI) to a business or as Food Cost is to a restaurant. The restaurant is a great example because everybody wants more customers – but that doesn’t always happen. But, if you increase the amount each customer spends (they call that “average ticket”) – when you do get more customers you’ll get more money.

So using that analogy, increasing the CTR IS the most important thing, because fluctuations in traffic will come and go…

Comment by
2007-07-28 02:22:33

I totally agree. When it comes down to it, increasing CTR is something that you should definitely work on…

Comment by ciken
2007-07-28 15:48:53

i agree too..CTR is important thing to boost adsense revenue..good article..thanks

Comment by pinolobu Subscribed to comments via email
2007-07-28 20:47:15

I’m not so good with percentages, so correct me if I’m wrong here: this means, which was established about a year and a half ago normally pulls about 330 uniques per day. Then suddenly it pulled 42,856 uniques over 3 days, an average of 14,285 uniques per day. You said in your dugg post that this resulted in your server (dedicated) being down for about 9 minutes. It must’ve been during the highest number of visits – I wonder what’s that number?

Comment by Gaman
2007-07-28 20:50:30

well it’s more than 330 actually. The percentage is a rough estimate.

Comment by Robinsh
2010-04-02 22:07:11

Here was something to learn about CTR and traffic for money making with the blogs and their promotion. Thanks for this detailed info, I am sure it will help me alot for better performance with the advertisement section of my blog.

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