Cost Per Click (CPC)

What Is Cost Per Click (CPC)?

Cost per click is a digital advertising model used to drive traffic to websites. For every click on an ad (displayed on another web page or site), the advertiser has to pay the publisher a fee.

Now you may wonder when the cost per click comes into use.

Usually, the purpose of many banner ads on websites is to entice site visitors to click on them and be led to the landing page of the advertising brand. Once users have reached the target site, they can then be converted to sales or just help increase website traffic.

So, CPC means that advertisers will only be charged per click.

With search engines, digital marketers usually bid on keyword phrases that are relevant to their target market and pay when site visitors click on their ads.

So, let’s talk about how CPC can benefit advertisers.


Why CPC Is Important

In advertising and marketing, CPC can be crucial because it can help businesses:

  • Invest money according to what they’re getting out of each click (on an ad)
  • Analyze how their ad campaigns are performing against competitors
  • Identify which ads, ad groups, or ad campaigns deliver the highest ROI (return on investment)

Moreover, cost per click can be cheaper than cost per ad because it means that your marketing team will only have to pay for the number of clicks, not the ad itself. The benefit this presents is enormous. 

It means that you can essentially run your ads in less popular digital spaces (or websites) too, which may attract fewer visitors but end up getting you highly loyal customers.

After all, the end goal of any marketing campaign is to increase conversions, and by creating more digital ads, you can increase your chances of generating new leads - while only having to pay for clicks!


Ways to Lower Your CPC

Digital advertisements are a critical part of marketing campaigns, and accrued costs can’t be avoided. But you can certainly lower the cost per click for your ads so that you’re not wasting money in online spaces that don’t lead to conversions.

Your average CPC can be affected considerably by improving your Quality Score. Your Quality Score changes due to:

  • Click-Through Rate - Click-through rate (CTR) is a measure of the number of times someone clicks on your ad when it appears in the search results. A user is more likely to click on ads that are more appealing to their interests.
  • Keyword Relevance -  Advertisements that are relevant to the keywords you've bid on, and that include your ad keywords, will, in general, get a higher  CTR and quality scores.
  • Ad & Landing Page Quality - Google rewards marketers who make convincing, and engaging advertisements.