What is Cost per click (CPC)?

Cost per click (CPC) - a term used in digital advertising to describe the amount of money an advertiser pays each time someone clicks on their ad.

CPC is one of the most common methods for pricing online ads, and it's often used alongside other models such as cost-per-thousand-impressions (CPM) or cost-per-action (CPA).

The main advantage of CPC pricing is that advertisers only pay when someone interacts with their ad. This means they can be sure that they're getting their money's worth, and it also encourages them to create high-quality ads that are more likely to generate clicks.

How does CPC work?

In a CPC campaign, an advertiser sets a maximum bid for how much they're willing to pay for each click. When someone searches for a keyword or phrase related to the ad, an auction takes place among advertisers who want to target that audience. The winner of the auction gets their ad shown on the search results page or other relevant websites.

If someone clicks on the ad, the advertiser pays the amount they bid. If no one clicks, then there's no charge.

This system incentivizes both advertisers and publishers to maximize engagement with ads by creating quality content and targeting relevant audiences.

The importance of optimizing CPC

To get the most out of a CPC campaign, advertisers need to carefully monitor and optimize their bids based on factors such as keyword relevance, geographic location, time of day, device type, and more.

In addition to this traditional optimization approach called manual bidding strategy which allows precise control over individual aspects ot advertising process there are modern automated strategies like Target CPA Bidding or ROAS Optimization which utilizes machine learning algorithms to optimize bids based on a variety of data points.

By using these strategies in conjunction with creative ad design and compelling copywriting, advertisers can increase their click-through rates (CTR), reduce their cost per click, and ultimately generate more conversions.