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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

Related Articles:
Related Glossary Terms:
  • Cost Per Click
    CPC or Cost Per Click is a payment model where advertisers pay every time a user clicks on an ad, regardless of the number of impressions. The cost per click bidding mechanism decides how much advertisers pay for their advertisements.
  • CPC
    CPC or Cost Per Click is a payment model where advertisers pay every time a user clicks on an ad, regardless of the number of impressions. Ads that are merely viewed by users but not clicked on are delivered for free in the pay per click model.
  • CPM
    CPM is an advertising term that stands for Cost Per Mille (thousand impressions). CPM is best used for brand awareness campaigns. Cost Per Mille (CPM) is the cost of having your online advertisement be viewed 1,000 times.
  • Pay Per Click
    Pay Per Click (PPC) is an advertising term that describes online advertising payment models where advertisers pay per each click. The word "pay-per-click" comes from the fact that an advertiser using PPC marketing must pay a fee each time a user clicks on their ad.


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