CPC (cost per click)
CPC stands for cost per click: the amount you pay when someone clicks on your ad. You calculate it by dividing your ad costs by the number of clicks.
- 3 min read
What is CPC?
CPC, cost per click, is the price of one visitor from an ad. In Google Ads, Bing and most social advertising platforms you do not pay for your ad being shown, but only when someone clicks on it. What you pay per click differs per keyword, per moment and per competitor.
You see two variants. Your maximum CPC is the highest amount you are willing to bid. Your average CPC is what you pay in practice. That is often lower, because in the auction you only pay just enough to beat the advertiser below you.
Why CPC matters for your business
CPC determines how many visitors you get for your budget. With a fixed monthly budget, a higher cost per click simply means fewer visitors, and so fewer chances of an Quote request.
Even so, a low CPC is not a goal in itself. A click costing a few euros on a keyword like “dakkapel plaatsen kosten” can deliver more than ten cheap clicks on “dakkapel ideeën”. The first searcher wants to get something done, the second is just browsing. What counts is what a click ultimately delivers in enquiries and signed jobs. That is why you always look at CPC alongside your conversion rates and your cost per lead.
How CPC works
Google runs an auction for every search. Your bid counts, but not on its own. Google also looks at your Quality Score: how well your ad matches the search, how often people click on it and how useful your landing page is. An advertiser with a better ad and page can therefore rank higher and still pay less per click.
An example. Say a heat pump installer in the Utrecht region advertises on “warmtepomp laten installeren”. The average CPC comes out at a few euros, because many installers bid on that keyword. Out of every fifty visitors, two request a quote. The installer then works it out backwards: fifty clicks times the cost per click, divided by two enquiries, is the price per enquiry. If that price is lower than the margin an average job brings in, that expensive click is actually a good click.
Timing matters too. In the heating season more people search for heat pumps and more installers bid. The cost per click then rises. In quieter months it drops again. Anyone who knows this does not panic over a more expensive month, and mainly checks whether enquiries grow along with it.
The same installer also sees clicks coming in on “warmtepomp zelf installeren”. Those clicks are cheaper, but deliver nothing. This is where negative keywords help to exclude that traffic.
Common mistakes with CPC
Steering by the lowest cost per click. Anyone who only hunts for cheap clicks often ends up on broad keywords with little buying intent. You get plenty of visits and few enquiries.
Bidding without knowing your margins. If you do not know what a customer brings in, you do not know what a click may cost either. Every bid then becomes a gamble.
Forgetting the landing page. A slow or unclear page lowers your Quality Score, so you pay more per click. On top of that, visitors drop off, so every click delivers less.
No conversion tracking. Without tracking you do not know which clicks lead to enquiries. You look at CPC because it is the only visible number, not because it is the most important one.
Throwing everything into one campaign. Brand name, service keywords and generic terms each have a different cost per click and value. Mixed together in one campaign, you cannot steer them separately.
How to approach CPC
Start with the value of a job. Work out what an average job brings in as margin and how many enquiries you need for one signed job. From that follows what an enquiry may cost, and from that follows what a click may cost.
Then make sure your tracking is right. With good conversion tracking you see not only the cost per click for each keyword, but also the enquiries that come out of it. Only then can you honestly decide where to bid more or less.
Next, improve what pushes your cost per click down: ads that match the search exactly, a landing page that delivers on the same promise and a tight list of negative keywords. A higher Quality Score makes every click cheaper without giving up visibility.
Finally, never judge your CPC in isolation. A rising cost per click is fine if your enquiries and revenue rise faster. A falling cost per click is bad news if enquiries dry up. Look at the whole picture, and steer by signed jobs.
Want to know what your clicks really deliver? At Search engine advertising we always start with that calculation, before a euro goes into advertising.
Frequently asked questions
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What is a normal CPC for a construction company?
That differs greatly per trade, region and keyword. Keywords with clear buying intent and a lot of competition, such as roof renovation or heat pumps, are more expensive than general terms. More important than a normal amount is what a click brings you in enquiries and margin.
How do I lower my cost per click?
Improve your Quality Score with ads that match the search exactly and a fast, clear landing page. Exclude irrelevant search terms with negative keywords. That way you pay less per click without dropping lower in the results.
What is the difference between CPC and CPA?
CPC is what you pay per click, CPA is what you pay per desired action, such as a quote request. CPC says something about the price of a visit, CPA about the price of a result. For a trade business, CPA is usually the number you steer on.
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