Cost Per Click (CPC) in Paid Advertising – Common Questions

What is a cost per click?

Cost per click (CPC) is an advertising model where the price advertisers pay every time someone clicks their online ad. It measures how much traffic you buy and how efficiently your campaign drives engagement. Read more about what CPC means and why it matters.

How is CPC calculated?

CPC is calculated by dividing your total ad spend by the number of clicks your ad receives.

Formula: CPC = Total Cost ÷ Total Clicks 

This tells you how much you’re paying per user who visits your site. See the full CPC formula breakdown here.

Can you give an example of cost-per-click advertising?

If you spent £200 on a campaign and received 400 clicks, your CPC is £0.50. The lower your CPC, the more efficiently your ads attract visitors. Click here for another example and what it reveals about ad performance.

What is a good cost per click?

A good CPC depends on your industry, audience, and competition. In general, the “right” CPC delivers profitable conversions – not just cheap traffic. Benchmarks vary widely, so it’s best to compare against your sector averages and long-term ROI, not other campaigns.

What is CPC and CPM?

CPC means you pay when users click your ad, while CPM (cost per thousand impressions) means you pay for every 1,000 times your ad is shown. Compare CPC vs CPM and learn when to use each.

Who pays the cost per click?

Advertisers pay the CPC each time a user interacts with their ad. The amount depends on your bid, ad quality, and competition. Essentially, you’re paying the advertising platform, like Google or Meta, for each visitor driven to your site.

What are common CPC mistakes?

Common CPC mistakes include targeting overly broad keywords, ignoring Quality Scores, and neglecting landing page relevance. These errors inflate costs and lower ROI. Smart campaign structure, better keyword alignment, and continual testing help avoid wasted spend.

How does CPC work in Google Ads?

In Google Ads, CPC is determined by your bid and Quality Score – not just who bids the most. Ads that are relevant and valuable to users often pay below their max bid, improving efficiency and ROI. Find out how CPC works in Google Ads.