CPC (cost per click)

The formula

• CPC = K / k

K is the advertising cost and k the number of clicks. It is an average over the campaign: what each click cost once the money is spread over all of them, whether the network charged per click or per thousand views.

A worked example

A campaign costs 5,000 and brings 2,500 clicks: CPC = 5,000 / 2,500 = 2.00. With the same budget and 1,000 clicks the CPC would be 5.

The clicks a budget buys

Turned round, k = K / CPC. A budget of 800 at a CPC of 1.60 buys 800 / 1.60 = 500 clicks. The card above solves for whichever of the three you do not have.

CPC from CPM and CTR

A campaign bought per thousand views still has a cost per click. At a CPM of 12.50 and a click-through rate of 2.5%, a thousand impressions cost 12.50 and give 25 clicks, so the CPC is 12.50 / 25 = 0.50. The relation is CPC = CPM / (10 · CTR) with CTR in per cent.

Common mistakes

• Counting impressions as clicks. The report lists both; CPC divides by the clicks alone.
• Comparing CPCs across channels and stopping there. A cheap click that never converts costs more per customer than an expensive one that does. CPA is the figure that follows the money to the sale.
• Mixing periods. The cost and the clicks have to cover the same dates.

Frequently asked questions