The goal of any company’s website is to get more visibility and traffic. This can be possible by different types of strategies.
You can use the organic search. This is an unpaid process known as search engine optimization (SEO). Or choosing another method that focuses on getting traffic from organic and paid searches. This process is known as search engine marketing (SEM).
There is another advertising strategy that is only paid and it’s called cost per click or CPC.
What is CPC (cost-per-click)?
As the name suggests CPC is a financial metric that measures the cost that the advertisers pay every time their ad is clicked. CPC applies to ads that appear on the results pages of search engines, display ads, and ads that appear on social media.
In the case of SEM, is the cost they pay every time their ad is clicked from a search engine such as Google.
This is a metric that applies to all types of ads no matter if they have text, images, or videos.
Often advertisers use CPC with a daily budget. When this budget is reached the ad is automatically removed from the website.
There is a formula that is used to determine the rate you pay per click.
How is calculated?
One of the most popular ways to calculate CPC is:
Advertising Campaign Cost / Number of Clicks
In order for ads to be displayed next to search results on search engines like Google and social networks like Facebook. Advertisers use a bidding process to determine the rates by choosing the maximum amount they are willing to pay for a click. Since advertisers only pay for clicks, they spend money on consumers interested in the product. And these paid clicks have the potential to turn into sales.
There is one more pricing option that defines the cost that the advertiser will pay for an ad campaign on a website. This metric is called cost per mille or CPM.
What is CPM (cost per mille)?
CPM is a paid advertising option where companies pay a price for every 1,000 impressions their campaign receives. This is why CPM is also called cost per thousand. An impression is when someone sees an ad on social media, search engines, or another marketing platform.
What is the difference between CPM and CPC?
The CPM model is a great choice for advertisers looking to build brand awareness. Because a CPM campaign is focused on putting the ads on as many screens as possible. This will help companies to know their audiences better. Then, once the brand’s visibility reaches a certain point, companies may transition to an action-based campaign. For example a PPC campaign.
PPC or pay-per-click is an advertising model in which the CPC metric represents the amount that the advertisers have to pay for every click. When the visitor clicks on the ad, they are taken directly to the publisher’s website and he has to pay the cost for that click. If this click leads to a sale then the investment has been valuable.
