Clicks or chaos: understanding the pitfalls of CTR in gauging genuine ad engagement

This study examines the limitations of Click-Through Rate (CTR) as a measure of online advertising effectiveness, emphasizing the influence of ad complexity and accidental behaviours. Although CTR has been viewed as a dependable indicator of ad engagement, recent decreases in click rates and shifting perspectives within the industry indicate a need for careful consideration regarding its reliability. This study applies the signal-to-noise ratio concept proposed by Kahneman et al. (2021) to indicate that CTR data often contains "noise"—clicks arising from accidental or curiosity-driven interactions that do not accurately represent genuine interest or intent to purchase. This research utilizes two empirical methods: a quantitative analysis involving more than 12,000 ad exposures and qualitative interviews. The findings suggest that visually complex ads indicate curiosity-driven clicks rather than genuine interest in the ad or product, which results in distorting click data. Moreover, accidental clicks are further considered another source of noise because they lack real user intention. This study highlights the importance of recognizing noise in CTR data, underscoring the need for improved metrics that accurately represent the quality of user engagement.<p></p>