What is PPC?

PPC or Pay-Per-Click is an advertising term that describes online advertising payment models where advertisers pay per each click, as opposed to the CPM model (which is impression based).

Typically, advertisers create PPC ads on search engine platforms and use keywords to reach their target audience.

The main appeal of PPC campaigns is that users have to perform an action before the advertisers are charged, leading to ad creative optimization and sales funnel optimization to ensure that the click leads to acquisition or another meaningful action for advertisers.

CPC (cost per click) depends on the industry, and the PPC advertising market can be very competitive. Bids that advertisers set define how high up in the results page their ad will be placed, and they depend on industry standards.

Other things that affect the ad placement are the ad’s quality score (based on keyword relevance, CTR, and the landing page) and ad extensions (links, CTAs). The quality score and the PPC markets themselves are constantly changing, so PPC campaigns should be optimized constantly to achieve low CPC and high profitability of the ad campaign.

The formula for calculating PPC cost is ;

PPC = advertising cost / ads clicked