What is CPC?
CPC or Cost Per Click is a payment model where advertisers pay every time a user clicks on an ad, regardless of the number of impressions. This payment model is typically used on platforms like Google AdWords and is preferable to CPM as advertisers can pay for meaningful engagement, as opposed to the number of impressions. CPC is also often called PPC (Pay Per Click).
With CPC, it’s important to optimize the sales funnel and understand how the advertising network generates clicks and approaches targeting. Publishers’ main interest is in getting as many clicks as possible, regardless of the source, which is why it’s important to optimize targeting to exclude as many imprecise clicks as possible, and increase the quality of traffic your website is receiving.
With PPC platforms, CPC is typically calculated through a variety of factors such as ad quality, ad rank, and maximum bids. CPC is among the most competitive payment models and platforms exactly due to almost guaranteed success. However, average CPC depends on the industry.
Many advertisers improve ad creative, keyword relevance and landing page quality as a means of lowering their CPC.
The formula for calculating CPC is:
CPC = Total ad spend / Total measured clicks