What is Cost Per Click (CPC)?

Cost Per Click (CPC) is a digital advertising metric that refers to the amount advertisers pay for each click on their ads. It is commonly used in pay-per-click (PPC) campaigns on platforms like Google Ads, Meta Ads, and Microsoft Advertising.

How to calculate Cost Per Click

CPC is calculated using the formula:

CPC \= Total Cost of Clicks / Total Number of Clicks

For example, if an advertiser spends £200 on a campaign that receives 500 clicks, the CPC is £0.40.

Why is CPC important in digital marketing?

CPC is a key performance indicator for advertisers because it directly impacts ad spend and campaign efficiency. A lower CPC means more traffic for the same budget, while a high CPC may indicate competition or inefficiencies.

Factors affecting CPC:

• Keyword competition – Highly competitive keywords tend to have higher CPCs.
• Quality Score – In platforms like Google Ads, better ad relevance and landing page experience can lower CPC.
• Ad targeting – Specific audience segments may have different CPCs based on demand.
• Bid strategy – Manual vs. automated bidding affects CPC fluctuations.