CPC (Cost per Click)

CPC stands for cost per click and describes a pricing model where the advertiser only pays for actual clicks, not for every impression. The model dominates search engine marketing and is one of the available bidding models on many social ad platforms. It shifts part of the risk from the advertiser to the ad provider, who is only compensated on click.

How CPC is formed

In auction systems such as Google Ads, CPC results from the bid and a quality factor that judges ad relevance and landing page quality. Competitive pressure pushes CPCs up, while strong quality factors lower them. Industries with high competition such as finance or insurance often see two digit euro amounts per click, while niches sit at cent levels.

How CPC differs from CPM

CPM pays for reach, CPC pays for interest signals. Brand building usually picks CPM, lead or sales focus often prefers CPC or CPA. The CPC model creates a more direct incentive for ad providers to deliver high quality clicks, because weak adverts otherwise barely monetise.

Practice note

CPC on its own is not a success metric, because a cheap click on a weak landing page still produces nothing. It is sensible to watch CPC together with conversion rate and CPA, since only that combination shows whether the clicks produce economic value. Negative keywords and granular audience choices keep CPC at a sensible level without giving up reach.