Affecting Average Cost per Click (CPC)

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• Affecting Average CPC

Affecting Average Cost per Click (CPC)

Raising / Decreasing Bid Cap

It is important to note that the maximum price you are willing to pay (bid cap) just influences what the average CPC will be; it is not actually what you will pay per click. It is totally dependent on the bid landscape, keyword quality score and keyword history as to what CPC will be charged.

As a rule, the bid cap is directly proportional to the CTR and total traffic. This therefore means that raising the bid cap has an exponential effect on the cost of the campaign. Not only does each click cost more, there are likely to be more clicks due to the improved position as a result of the higher bid.

Using Existing Tail Keywords as Seed Keywords to generate further Tail Keywords

This is an indirect way in which we can reduce the average CPC of a campaign. This method will only have a noticeable effect if the majority of the keywords in the campaign are on broad match.

By using the keyword tail principle (the further down the tail we go the cheaper the traffic) we can lower the average campaign CPC by using more traffic-generating tail keywords.

Adding Negative Keywords

As mentioned earlier, by adding negative keywords we can reduce the likelihood that ads will be shown for irrelevant keywords. Due to the fact that all the major search networks operate a quality score system for attributing cost to a click, where CTR has a substantial weighting; by eliminating unwanted impressions, inadvertently we are increasing the relevancy of the campaign which subsequently increases the CTR and reduces the average CPC.

Improve Relevancy of the Landing Page and ad Copy

Like CTR, the relevancy of the landing page and ad copy is part of the formula the networks use to calculate each keyword’s quality score; therefore, the more relevant the content is, the higher the quality score will be and consequently the lower the average CPC will be.