Clickthrough Rate (CTR): Abracadabra! Stop Declining

November 18, 2010 § Leave a comment

Good news. CTR has stopped declining first time since July 2007.

Based on the analysis of MediaMind, a digital ad solutions provider, annual average click rates worldwide have “plateaued” at 0.09%. The initial drop was caused, ironic but not counterintuitive, by the success of online display ads, an overwhelming amount of advertisement flooding into the virtual world. According to eMarketer, “As users saw more and more ads across the internet, many continued clicking, but not fast enough to keep up with the expanding inventory. Clickthrough rates fell steadily until reaching an equilibrium.”

“Although CTR is only a partial measure of online success, the leveling of CTR shows that online advertising has reached a level of maturity and that advertisers have become more sophisticated in luring users’ interest,” said Gal Trifon, CEO and co-founder at MediaMind, in a statement.

Is it? Are advertisers becoming more “sophisticated” in pandering to users’ interest?

“Luring”, GENERALLY speaking, is an offensive word to consumers, for whom outright and sometimes implacable hostility toward the incessant pestering of online ads is the norm. There is no denial that users have become more rebellious these days. No one is willing to admit that they have fallen into the trap of a distracting enemy. (I’m not talking about quality-guaranteed Tiffany & Co. display ad on the homepage of the New York Times, but rather online ads in general.)

I couldn’t help but wonder, are internet users becoming more tolerant towards online ads and actually find them helpful, or is it that advertisers are doing a better job at hiding the little cross close button usually displayed at the upper right side? It happens to me all the time, I would accidentally click through an ad while recklessly fumbling for the close or shut-up button of the ad.

*Disclaimer: My bias, or put it more accurately, mixed feelings about online ads comes from my personal experience in China, the constant startling effect, coarsely-made video ads bring me when they jump out of nowhere often with ill-taste extra-loud music. (Has anyone ever noticed that TV advertisement is louder than ordinary program? I usually have to turn it down when the ads begin.)

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