When visitors clid on an ad, an amount of money is transacted between the owner of the website to the ad owner who hosted it, This is called the cost per click. CPC is a keyword-based operation within the browser and aims to deliver relevance to the ad spaces. These can come under web searches along with the websites and visitors recognize an opportunity via keywords on the site. The real click cost for each click differs on how popular the desired keyword is and the demand for the ad space, timing, etc. This is preferred due to the cost saved with the ads not clicked and assured a high result with less risk involved.
Cost per click helps business leaders calculate the return on investment in a manner that is quick and efficient. It must be taken into account, however, that certain keywords have a higher cost per click when compared to others. These keywords produce a better ROI due to heightened conversion rates. With CPC determined, business executives can then determine if they are overspending or underspending on specific online marketing efforts and campaigns. CPC should be measured in terms of value and cost. Users can calculate Cost per click as the result of dividing the cost of a paid advertising campaign by the number of clicks procured.
CPC = Advertising cost/ number of clicks
With paid advertising platforms like Google Adwords, certain strategies such as manual and enhanced cost per click are made available to the user to ensure the best strategies are in place for an online marketing campaign.