The most important number in any Google AdWords campaign is the Click Through Rate (CTR).  Now let's talk about what the heck that means and what you need to do about it.  

What is a CTR (Click Through Rate)?

In it's simplest terms, a CTR is how often people click on your ad in AdWords.  Here's a bit more detail:

Every AdWords search campaign includes three elements:

1. The Keywords You Targeting 
2. The Ad You Want Google To Show When People Search for the Keywords You Are Targeting
3. The Landing Page Where People Will Arrive When They Click On Your Ad

For the sake of brevity, I will use the following abbreviated terms:

1. Keywords
2. Ad
3. Landing Page

So, in these terms, a CTR is the number of times Google showed your Ad for a specific keyword divided by the number of times people clicked on your ad when it was displayed for that keyword.  For example, let's say you wanted your ad to show every time someone searched for the words "tacos savannah".   If people searched for the words "taco savannah" 100 times and your ad showed up all 100 times, and people clicked on that ad only 10 times, you would have a CTR of .1 (10/100 = .1).  

The Big However -
Google Doesn't Always Show Your Ad

In the example above, I said that you wanted your ad to show up whenever people searched for the words "taco savannah", and I wrote about a scenario where people Googled the words "taco Savannah" 100 times and you ad showed up 100 times.  The big however, is that Google will not always show your ad even when people are searching for the specific keywords you are targeting.  Google wants people to click on its ads. So, if they think your ad is less likely to get a "click" from the searcher, they will not show it, or will not show it as prominently as other ads.  

How does Google judge which ad is most likely to be clicked by searchers?  They look at the account's history and specifically at the CTRs for that account.  Accounts with better click through rates, are likely to produce ads that will continue to get more clicks.  More clicks, means more money for Google.  So Google is going to be more likely to show that ad more prominently.   

The Bottom Line - Part One

Google judges the success of your AdWords campaign by your click through rate.  If your ads get clicked on often, they will show your ads more often.  The number which describes how often your ad is clicked is called "the click through rate" (CTR).

For more information about Google AdWords in general and CTRs specifically, click here.