In short, CTR means click-through rate, or sometimes people will say click-through ratio. The term in itself means exactly what the term says, in that it means how many times a person clicked on a link or ad online versus how many times it was shown.
CTR is used in many different ways, so just knowing a general CTR of an ad campaign can be deceiving. For example, if you are running a PPC (pay-per-click) campaign, it can mean two different things depending on what you are doing with that. If you are running a direct campaign, meaning the ad that is shown on the PPC platform like Google is linked directly to your action page, then your CTR to the money page will be higher then if you linked the PPC campaign to a landing page first.
CTR is an important analysis tool when judging the performance of a campaign. CTRs vary greatly depending on the advertisement, niche, ad copy, etc. There are not set CTRs that are considered ideal, just whatever is profitable in the long run.
One way many marketers use CTR is to know how much to pay for ads. Say CTR is 10% and the conversion rate is 10%. So, is you paid for an on a CPM basis, or per thousand impressions, of say $10, then you would know that for every $10 you spend, you would get 10 sales. The CTRis 10%, so 1000 impressions get you 100 visitors to your site. 100 visitors gets you 10 sales at a 10% conversion rate. Now you know how much you can pay on a CPM basis.
Those are just some ways you can use CTR to help your bottom line!