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CPC (cost per click): What is it? What is it used for?

- Reading Time: 2 minutes
CPC, or Cost Per Click, is a digital advertising metric used to measure the cost incurred by an advertiser for each click on their advertisement. It is a common pricing model in online advertising platforms, where advertisers pay a predetermined fee each time a user clicks on their ad.

Whether for advertising on search engines or social networks, CPC (or cost per click) is one of the benchmark indicators. So what exactly is it? What is it used for? How can it be optimised? Find out the answers.

What is CPC?

CPC stands for cost per click. In other words, the cost charged to companies for each click on an ad.

This pricing method is used for advertising campaigns on search engines (such as Google Ads) or on social networks (such as Facebook Ads, Linkedin Ads, etc).

What is the difference between average CPC and maximum CPC?

As its name suggests, the average CPC is the average cost per click actually billed to a company. It is calculated as follows

CPC = total cost of clicks / total number of clicks.

Conversely, the maximum CPC is the highest amount a company is prepared to pay for a click. The average CPC cannot therefore exceed the maximum CPC, which corresponds to the highest bid.

What is the cost per click used for?

Cost per click allows companies to estimate the budget spent on paid search campaigns. This enables them to:

  • Customise advertising campaigns according to their objectives;
  • Generate traffic in line with their budget;
  • Test the relevance of landing pages and optimise their effectiveness.

Ultimately, CPC is an excellent indicator for defining the best conversion bidding strategies.

How can you optimise your advertising budget?

The ultimate aim of any advertiser is to maximise the number of clicks, while optimising their budget, the number of keywords targeted and the quality of the traffic.

This depends not only on the cost per click, but also on :

  • The click-through rate (CTR): this refers to the number of clicks actually made on your ad when it is displayed.
  • The relevance of the ad: in relation to a user’s search intent. To determine this, it’s vital to have the best possible knowledge of your target audience.

Key facts:

  • CPC is a billing method for advertising campaigns.
  • More precisely, it refers to the cost charged to advertisers for each click made on their links.
  • This indicator can be used to estimate the budget allocated to a marketing strategy based on online advertising.
  • To optimise their advertising spend, companies need to pay attention not only to the cost per click, but also to the expected click-through rate and the relevance of their ads.
  • They therefore need to have a wide range of data at their disposal if they are to run effective campaigns that fit within their budget.

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