Marketing metrics explained

What is CPC in advertising

CPC is cost per click: the amount you pay each time someone clicks on one of your ads.

About the Google Ads connector

If a campaign spent £900 and received 1,500 clicks, its average CPC was £0.60.

The term does double duty. In reporting, CPC is the average you actually paid. In bidding, "max CPC" is the most you have told the platform you are willing to pay for one click, and the figure you pay is usually lower than it. The two are easy to confuse on a screen that shows both.

How it's calculated

Average CPC = ad spend ÷ clicks

The Google Sheets version with a guard against an ad group with no clicks, and a worked example, are on the CPC formula page.

What it tells you, and what it doesn't

CPC tells you what a visit costs. It is the right figure for comparing keywords or ad groups that are all buying the same kind of traffic, and for spotting a keyword whose price has climbed.

It tells you nothing about what the visit did. A £0.60 click that converts at 5% costs £12.00 per conversion; a £0.30 click that converts at 1% costs £30.00. The cheaper click is the dearer customer. CPC only becomes useful next to a conversion rate, and the product of the two is CPA.

Average CPC is also set by an auction you only half control. Your bid, your Quality Score and what competitors are bidding on the same terms all move it. A rising CPC on an unchanged campaign usually comes from other advertisers changing theirs.

Where it goes wrong

Reading max CPC as the price. Max CPC is a ceiling. On Google Ads you pay enough to beat the next advertiser, which is usually less than your maximum. Reports and budgets should use average CPC, the figure that was actually charged.

Averaging CPCs. A keyword with 10 clicks and one with 10,000 should not be weighted equally. =AVERAGE() on a column of CPCs does exactly that. Divide total spend by total clicks instead.

Optimising for the lowest CPC. The cheapest clicks come from the broadest terms and the least interested people. A campaign pushed towards low CPC tends to find its CPA going the other way. Judge keywords on cost per conversion, with CPC as one of the two things that drive it.

Comparing CPC across intent. A click on a brand search and a click on a generic category term are different products at different prices. A blended account CPC hides that, and a change in the mix between them changes the average with nothing else moving.

Related metrics

• CPC formula: the calculation and a worked example.
• What is a good CPC: the factors that move it and how to find your own baseline.
• CTR formula: clicks per impression, the figure that connects CPC to CPM.
• CPM: cost per thousand impressions, one step up the chain.
• CPA: cost per conversion, which is CPC divided by conversion rate.
• Google Ads Quality Score: the rating that discounts or inflates the CPC you pay.

Keeping it current

A scheduled Fresh Sheets report can pull Cost and Clicks from Google Ads into a tab of your spreadsheet by campaign or keyword. It replaces that tab's contents on every refresh, so keep your formulas on a separate tab. This finds each column by its heading:

=SUM(INDEX('Google Ads'!A:Z, 0, MATCH("Cost", 'Google Ads'!1:1, 0))) / SUM(INDEX('Google Ads'!A:Z, 0, MATCH("Clicks", 'Google Ads'!1:1, 0)))

Work out your CPC with the free calculator