Click-through rate is a simple ratio: the number of clicks your ad gets divided by the number of times it was shown (impressions). If your ad appeared 1,000 times and was clicked 50 times, your CTR is 5%. What counts as "good" varies wildly by industry and position, so comparing your number to a generic benchmark is less useful than comparing it to your own trend over time.
CTR matters to Google because it is a strong signal of relevance. If lots of people who see your ad choose to click it, that suggests the ad is answering what they searched for. Google folds this into expected click-through rate, one of the three factors behind your Quality Score. A better expected CTR contributes to a higher Quality Score, which can earn you better ad positions at lower costs. In other words, improving CTR is not just about traffic volume — it can literally make each click cheaper.
