Click-through rate is a metric that measures the number of clicks advertisers receive on their ads per number of impressions.
Click-through rate is a great indication of how well your ads are resonating with your audience. If your CTR is high, it is likely that your ads are both enticing and highly relevant to what searchers are looking for. Click-through rates are particularly important to focus on because they directly impact your Quality Scores (and, in turn, you will be eligible to receive higher positions at a lesser cost).
What is a “Good” Click-Through Rate?
This is an often-debated topic. From a purely statistical standpoint, it depends. Take a look at Yahoo's answer to the "what's a good click-through rate" question:
The honest answer to the question is, “It depends.” Click-through rates are naturally going to vary from campaign to campaign, and even from keyword to keyword. Everything involved in the way your ad is displayed plays a part, from your ad copy to the ad’s ranking on the results page.
So while you want to have a "high" click-through rate, there's really no magic number. Average click-through rate will vary by industry, and your expected CTR depends on your ad's position, among other factors. Generally speaking, the higher your ad’s position is, the higher your click-through rate should be. Google is likely to penalize advertisers with high ad rank and low click-through rates by lowering their Quality Scores.
Bear in mind, you should only be bidding on keywords that are pertinent to your business. If you are attaining high CTRs on keywords that are not relevant to your product or service offering, it is unlikely that you will see a high ROI on those keywords. For those types of keywords, those irrelevant clicks will definitely generate traffic to your site; but are unlikely to convert for you.