CPC stands for cost per click and is also abbreviated as PPC (pay per click). This describes a billing model in online marketing. CPC is a constantly scalable, digitally measured variable that you can use to calculate your advertising budget.
How it works
Such advertising networks as Google AdWords calculate the costs mainly based on the following principle. The advertiser does not pay for the placement of the advertisement, but only when the advertisement is actually clicked. They can appear in different forms, such as text links, banners or videos.
CPC values range from a few cents to larger double-digit amounts. The amount depends on several factors:
- Quality: The higher the quality and reach of the page the ad appears on, the higher the CPC.
- Promotional materials: For example, banners are usually more expensive than text links.
- Placement: Generally, the more accessible the ad to the user, the higher the CPC. Therefore, posting ads on subpages is usually cheaper.
The following factors are important for the calculation in the Searchmetrics Suite:
- Number of competitors: The cost per click on Google AdWords depends on the number of competitors and the amount of their bids.
- Industry: Competitive industries, such as the financial sector, have higher costs per click.
Knowing the CPC for a keyword gives you an idea of its value. Usually, the higher the CPC, the more competitive the keyword is.
CPC in the Searchmetrics Suite
The CPC can be displayed for each keyword across all keyword lists in the Research Cloud and the Search Experience. The value shows the average cost per click on Google Ads (Adwords) in Google search results.
The CPC is used to calculate Traffic Value, Traffic Value Potential, and Δ Traffic Value Potential.
The CPC for a keyword can provide important additional information about how useful an optimization can be. If a keyword has a high search volume, informational or transactional search intention, and a high CPC, a high online competitive situation can be assumed to reach one of the top ranking positions. Conversely, a keyword with a low CPC can also indicate that the optimization can generate traffic, which then is not converted on the website.