Click-through rate (CTR) is an incredibly important concept in search engine marketing. The simplest definition is that click-through rate is the percentage of people who click on your ad after seeing your ad. (In mathematical terms: CTR = Clicks/Impressions.)
With both AdWords and organic SEO, your success can be improved in only three ways: (1) getting more people to see your ad or snippet; (2) getting more people to click on your ad or snippet; or (3) getting more people to become a customer (i.e., convert) on your landing page. In other words, search engine marketing is a “constrained system.” And one of those constraints is the CTR.
With AdWords, your CTR is one of the key components of your quality score. In SEO, your CTR is going to determine whether you maintain your ranking.
Basically, you can think of Google (and more broadly, all search engines) as a democracy: people vote by clicking. So your CTR will really determine your success.