Q.An online advertisement was shown 20,000 times and received 500 clicks. Of those who clicked, 25 made a purchase. Calculate

CTR compares clicks with how often the advertisement was shown, while conversion rate compares purchases with clicks.

We are given: impressions = 20,000, clicks = 500, purchases (conversions) = 25.

(i) Click-Through Rate (CTR). CTR is the percentage of viewers who clicked, that is clicks out of impressions.

• CTR = (clicks ÷ impressions) × 100 = (500 ÷ 20,000) × 100.
• 500 ÷ 20,000 = 0.025, and 0.025 × 100 = 2.5%.

Verification: 2.5% of 20,000 = (2.5 ÷ 100) × 20,000 = 500 clicks, which matches the data.

(ii) Conversion Rate. The conversion rate is the percentage of clickers who made a purchase, that is conversions out of clicks.

• Conversion rate = (conversions ÷ clicks) × 100 = (25 ÷ 500) × 100.
• 25 ÷ 500 = 0.05, and 0.05 × 100 = 5%.

Verification: 5% of 500 = (5 ÷ 100) × 500 = 25 purchases, which matches the data. …

Both are 'part out of whole' percentages. For CTR the whole is impressions; for conversion rate the whole is clicks. In each case divide the part by the whole and multiply by 100, then che …

The most common error is using the wrong 'whole': CTR must be divided by impressions (20,000), not clicks, while conversion rate must be divided by clicks (500), not impressions. Dividing purchases b …