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What Is Cost-Per-Click (CPC)? | Speed Commerce

What Is Cost-Per-Click (CPC)?

3PL Glossary > Cost-Per-Click (CPC)

What Is Cost-Per-Click (CPC)?

Cost-per-click (CPC) is a digital advertising model where advertisers pay a fee each time a user clicks on their online ad. It is a common pricing structure used in various online advertising platforms, including search engines, social media networks, and display advertising networks. The CPC model is designed to provide advertisers with a measurable and performance-based method of payment, aligning with the idea that advertisers only pay when a user takes the action of clicking on their ad and navigating to the advertiser's website.

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In a CPC advertising campaign, advertisers bid against each other for the placement of their ads in the advertising space. The bid amount represents the maximum cost the advertiser is willing to pay for a single click on their ad. The ad platform, such as Google Ads or Facebook Ads, considers both the bid amount and the ad's relevance and quality to determine the ad's position in the advertising space. Advertisers are then charged the bid amount when a user clicks on their ad.

CPC is often favored by advertisers because it offers a direct and measurable way to assess the effectiveness of their campaigns. Advertisers can track the number of clicks, the cost per click, and the overall return on investment (ROI) for their advertising spend. This model provides transparency and allows advertisers to optimize their campaigns based on real-time performance data, making CPC a popular choice in the digital marketing landscape.


Yes. In a CPC model, advertisers set a maximum bid amount, representing the highest cost they are willing to pay for a single click on their ad. Ad platforms use this bid, along with other factors like ad quality and relevance, to determine the ad's position and the actual cost per click.

Not necessarily. While a higher bid can contribute to better ad placement, ad platforms also consider factors like ad relevance and quality. An ad with a lower bid but higher relevance may still secure a prominent position. Advertisers should focus on a balance between bid amount and ad quality for optimal performance.

Yes. Advertisers can adjust their bid amounts during a campaign based on performance goals, budget considerations, and competition. Ad platforms allow flexibility in bid management to optimize campaigns in real-time.

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