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Cost Per Click
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Keep in mind, the CPC can depend on many factors including:
1. Cost-efficiency
CPC ads are often viewed as more cost-efficient than CPM ads because businesses only pay when a customer clicks on an ad. However, the cost efficiency and ad conversion rate, or the percentage of clicks that result in a sale, depend on many factors, such as:
- Clearly defined target audience(s) and campaign goals
- An optimized landing page
- A clear call to action in an ad (e.g., Learn more, register, and sign up)
2. Reach a highly desired audience
CPC ads help businesses drive a high volume of targeted customer traffic to a website or landing page throughout the campaign.
3. Accurate performance tracking
Many advertising platforms enable marketers to track campaign performance on the backend. Once marketers create an account and set up a CPC campaign, they can track whether users are converting or buying something on the targeted website. Likewise, marketers can track if a user has taken action, such as an email sign-up or downloading content after they click on an ad.
4. Campaign optimization
Ad campaign performance data can help marketers optimize their ad spend and maximize performance. Optimization involves increasing or decreasing bids per click to improve the overall return on investment (ROI) or return on ad spend (ROAS). We will provide some additional CPC ad optimization tips later in this post.
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Automated bidding options
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How does targeting impact cost-per-click?
With the same creative, marketers can get a higher or a lower CPC using more granular targeting parameters, such as:
- Geo-targeting: Targeting only the cities or regions where an audience is located will help maximize the ad spend budget and match the CPCs of that region versus a broader geo-targeted audience.
- The targeted device: Mobile and tablet-only targeted campaigns can have different CPC pricing than desktop-only targeting or a combination of both. Again, it depends on the campaign goals and desired outcome.
- Customer profile targeting: It’s critical to have a well-defined target audience with “audience attributes” such as demographics, education, and job experience. Ad copy and creative that speaks directly to that audience will also boost an ads’ relevancy score, which we’ll talk about next.
1. Optimize the ad quality or relevancy score
To increase the CPC ad quality or relevancy scoreopens in a new tab in an auction, try:
- Improving the landing page design and copy to lower bounce rates
- Narrowing target audience attributes
- Testing different advertising formats, copy and design to see which ones are more relevant to the target audience
2. Experiment with bidding strategies
If a campaign’s daily budget gets spent easily every day, try lowering the manual CPC bid to see if it will still deliver in full. Sometimes broadening the target audience can surprisingly lower the CPC, as well. Particularly if the target audience is very small. Again, it all depends on individual campaign goals. Additionally, marketers can pause campaigns or ad formats that don’t have a high click-through rate.
3. Run an A/B or split test
Use web analytics and campaign data to run an A/B split test to determineopens in a new tab which ad copy and creative ad variations are generating higher click-through rates.
