Metric of the Week: Cost per Click (CPC)

What is the Metric?

Advertising costs divided by number of ad clicks.

Why Should You Care?

The key underlying KPIs to the critical metric “Cost per Lead” are 1) Conversion Rates and 2) Cost per Click (below).

  1. The conversion rates are the percentage of people who click on your ad and take your desired actions.
  2. The Cost per Click, or amount you pay each time someone clicks on one of your online ads clearly effects your cost per lead/sale and thus must be tracked. Note that if you pay for online ads per impression, you can still calculate and track the cost per click (total ad cost divided by total clicks). In this case, you will also want to track your click through rates.


What Can You Do To Improve This Metric?

Lowering your Cost per Click can be done through a multitude of different means. One of the most basic is lowering your bids, bidding less will obviously cost you less money and bring your CPC down.

Next would be researching and finding additional keyword variations. Finding more relevant keywords can help show your ads to the people best suited for your product or service.

Continuing on the topic of relevancy, you can work on making your ads more relevant and better suited to your audience as well. As well, try using different landing pages leading from your ads, find which ones work the best while continually trying to make them better by adding new ones to the fold and choosing the best performers.




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