Cost-per-click (CPC): What is it and how to reduce it

What does this mean?

If your CPC is high, that means you're paying a lot for each click on your ad. This could be an indication that your ads are not resonating with your target audience or that you need to change your targeting strategy. In this article, we'll discuss some of the reasons why CPCs may be high and offer recommendations on how to fix this issue through actionable steps.

What is the cause of a High CPC?

Reasons for High CPCs:

1. Competitive Market: A highly competitive market can lead to high CPCs as advertisers bid higher to win ad placements.

2. Low Ad Relevance: If your ads are not relevant to your target audience, it can lead to a low click-through rate (CTR) and high CPCs.

3. Poor Landing Page Experience: If your landing pages are not optimized for user experience and do not provide relevant information to your audience, it can lead to a low-Quality Score and higher CPCs.

4. Bidding Strategy: Incorrect bidding strategy, such as bidding too high or not adjusting bids based on performance data, can lead to high CPCs.

What can I do to fix this?

Actionable Steps to Fix High CPCs:

1. Improve Ad Quality: Ad platforms like Google Ads and Facebook Ads use complex algorithms to determine ad relevance, taking into account the quality of the ad, its relevance to the target audience, and the user experience of the landing page. To improve ad quality and relevance, consider the following:

• Use high-quality images and videos in ads

• Write compelling ad copy that is relevant to the target audience

• Ensure the landing page provides a seamless user experience

• Experiment with different ad formats to find what works best

2. Keyword Selection: High-competition keywords typically have higher CPCs, so consider the following:

• Use long-tail keywords or more niche search terms that have lower competition and cost

• Use negative keyword selection to avoid irrelevant clicks and reduce ad spend

• Monitor keyword performance and adjust bids and targeting as needed

3. Targeting: Effective targeting is crucial for reducing CPCs, so consider the following:

• Narrow the target audience to a specific demographic or geographic area

• Use audience targeting to show ads to users who are more likely to be interested in your product or service

• Monitor audience performance and adjust targeting as needed

4. Continuously Monitor and Optimize: Continuous monitoring and optimization of campaigns are key to managing CPCs, so consider the following:

• Regularly review ad performance metrics, such as click-through rates, conversion rates, and cost per conversion

• Make adjustments to ad copy, targeting, and bid strategies based on performance data

• Test different ad variations to see what works best

By implementing these recommendations, you can lower your CPC and get more value from your advertising budget.