If you do online advertising campaigns, you have certainly heard of Cost per click or in its abbreviated version CPC. Today our goal is to make you experts in CPC.
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What is cost per click?
Pretty simple. Cost per click is the amount you are charged each time someone clicks on your ad.
2- The little history of CPC
Let's start with a little step back in time. Many years ago, when you paid for a traditional advertisement (in a magazine for example), the cost was established according to the number of copies published. The greater the reach of the advertisement, the more the advertiser was willing to pay.
With the advent of digital media, more and more advertising platforms gave the opportunity to advertisers to reach a very large audience. This gave birth to the notion of cost per 1000 (CPM). People were then aiming to be charged X$ every time their ad was displayed 1000 times.
Then over the years, with the explosion in the number of online searches, a new advertising billing model emerged. Pay per click (PPC). This, still popular today, involves charging a fixed amount each time an ad is clicked. Google and Overture (GoTo.com) are certainly two major businesses who have played a key role in the popularity of this method of advertising billing.
So instead of negotiating a cost per thousand, advertisers now wanted to pay the best rate per click possible. This was the birth of CPC (cost per click).
How much should you pay per click?
At the end of the 1990s, more than 400 major brands were paying between $0.005 and $0.25 for each click obtained on their advertisements on search engines like Google. In 2022, Wordsteam.com* estimates that the average cost per click paid on Google is $2.96!!!
Does this mean that if you pay around $3 per click your result is good? No way. It would simply mean that you are paying the average amount. However, this amount is not necessarily good or bad for you.
If you're advertising online, the first thing you should do is calculate how much you're willing to pay for a consumer to click on your ad. To do this, you need to identify 3 things:
- What is your average sale amount
- What percentage of this amount are you willing to pay to make a sale
- How many clicks you need to get a sale.
If you need help calculating your ideal cost per click, please do not hesitate to contact us. It will be our pleasure to help you establish a CPC objective adapted to your reality.
*Google Ads Cost Per Lead Has Increased for 91% of Industries YoY | WordStream
