CPC (Cost Per Click)
Definition
How much you pay each time someone clicks your ad. In Google Ads, you bid on CPC but actual costs depend on competition and quality.
What is CPC?
CPC stands for Cost Per Click. It's the amount you pay each time someone clicks on your pay-per-click advertisement.
Formula: CPC = Total Ad Spend ÷ Number of Clicks
If you spend £100 and get 50 clicks, your average CPC is £2.
How CPC is Determined
Google Ads Auction
You set a maximum bid, but actual CPC is often lower. Google uses:
- Your maximum bid
- Quality Score (ad relevance, landing page quality, expected CTR)
- Competition for that keyword
Higher Quality Score = Lower CPC (Google rewards relevant ads).
CPC Variations
Average CPC
Across all clicks in a campaign.
Maximum CPC
The most you're willing to pay per click.
Actual CPC
What you actually paid (usually below max).
Enhanced CPC
Automated bidding that adjusts bids based on conversion likelihood.
Typical CPC Ranges
Highly variable by industry:
- Low competition keywords: £0.50-2
- Medium competition: £2-5
- High competition (legal, insurance): £20-50+
Local service keywords often cost £1-5 per click.
Reducing CPC
Improve Quality Score
Better ads and landing pages = lower costs.
Long-tail Keywords
More specific keywords often cost less.
Negative Keywords
Exclude irrelevant searches to improve CTR.
Better Targeting
Narrower targeting = more relevant clicks = better Quality Score.
Geographic Targeting
Limit to areas you actually serve.
CPC vs CPA
- CPC: Cost per click (traffic)
- CPA: Cost per acquisition (conversion)
CPA is usually more important. Cheap clicks that don't convert are worthless.