Understanding the concept of PPC and CPC

Understanding the concept of PPC and CPC

Looking and scrolling the Internet means visualizing a lot of paid ads before seeing anything organic or looking for sponsored ads along with other things. While

These ads can help you get what you are looking for, or sometimes they have the answers to what you actually want- so you instantly click them!

But, how did such ads find you? Advertisers have paid for you to click them, which in technical terms is called PPC, and the price that advertisers pay for you to see such ads is called CPC.

Let’s explore it more and know what exactly these two are and what the difference is between the two.

What is the difference between CPC and PPC?

PPC or Pay per click is simply a method of paid advertising where businesses have to pay for the placement of an ad after it gets clicked. These ads usually appear at the top of the SERPS, or you may encounter them while scrolling to social media.  It comes in various forms, and the most common one is the display ads. These ads are used on Instagram and Facebook.

On the other hand, CPC is the Cost-per-click, which is the total cost of every click that comes with the ad click.  A simple example of these two would be “We are running the PPC ads on Instagram at the cost of $0.50”.

Further, PPC can be stretched to various other platforms like:

  • Microsoft ads
  • YouTube ads
  • Google Ads
  • Instagram Ads
  • Facebook ads

How does PPC work?

To answer this, PPC depends on the advertising platform that you are using. The most common advertising platforms are:

Google PPC ads:

In this type of advertisement, Google ads are shown on the keyword or the search word that the user types in the search bar. Putting a keyword is the tactic that most advertisers use to analyze the appropriate keyword to bid on budget, industry, and product. Google ads are also of two types:

Search ads, having B2C and B2B business types:

  • These ads perform better organic search
  • Google is the most popular and well-known in the marker of search engine
  • Automation is another way where advertisers use bid management.

PLAs (product listing ads) for B2C or for Ecommerce:

These ads are associated with the Google shopping Feed; in this, the feed is required to get the product information.

These are managed through Google AdWords or Google Merchant Centre

The lower the value of the item, the higher will be the chance of making its immediate purchase, and the higher will be its performance

In both formats, the advertisers will pay Google every someone clicks on their ads through the PPC model. In this, the Cost Per Click is identified through live bidding, where the advertisers identify the cost for every click.

Facebook PPC Ads:

Just like Google ads, their ads are also auction-based and are dependent upon the bids. The cost of every click is entirely based on the competition and the reach to the audience. When advertising through Facebook, keep in mind that you must reach maximum people; in other words, your reach should be high, not the Search Volume.

The ads that tops the auction have the following things:

  1. Estimated action rates
  2. Bid
  3. Ad Quality and relevance

You need to select your objective, audience, ad placement, budget, and ad format to process such ads. 

Some of the most common varieties of Facebook ads are link click ads, video ads, dynamic product ads, Facebook lead generation ads, App ads, Page post ads, offer claim ads, event ads, and more.

How does CPC work, and how does it impact the PPC:

As mentioned above, the CPC is based on various factors like how much there’s competition in the market, how the keywords are search terms ranking, and what the fluctuations are in the market. Another major factor that comes in the CPC is the quality score.

How does the bidding system work?  

These campaigns are organized around the various ad groups, a collection of more than one ad, which has the same keywords. In this, the campaign consists of a list of keywords, landing pages, and every element on the ad campaign is optimized just to increase the conversions. Here are few steps you must follow to calculate the CPC:

  1. What is the advertising cost? E.g.: $500
  2. How many clicks have the ads gained? 625 total click
  3. Divide the overall cost with the number of clicks e.g., $500/625 click
  4. The answer is the total CPC of your ad i.e., $0.80

Here are some other levels of CPC that you must know:

  • Account CPC
  • Ad Group CPC
  • Keyword CPC
  • Campaign CPC

How to build your next strategy with PPC Campaign:

Here are steps you need to follow to create your next PPC campaign:

Choose the relevant keywords: This will help you choose/pick relevant keywords that are related to your ads and are lucrative to your business. For instance, you have a denim business; the common examples are Buy denim, Online Denim sellers, Buy Denim online, etc.

Design your ad: This is where you can make your audience see the brand and communicate with it. You can do this by creating an impressive CTA. Here are few things to keep in mind when designing an ad:

  • Make it short
  • Use action verbs
  •  Design your ad in a way it looks appealing and eye-catching
  • Must have logo or brand name
  • There should not be too many Colors
  • The CTA should be Clickable with a link that takes you to the connecting page.

Optimize your Ad: Make sure you include keywords in the most natural and relevant manner, such as in the meta description, title, within the body, and more.

Keep in Mind your Bidding Requirements: You can do this by separating your keywords from broad to specific and location-based. Also, keep in mind the geotargeting and set a maximum CPC depending upon your profit and CPA.

Lastly, analyze your Results: Keep in mind that each ad is different and will vary according to your business needs. So, keep on monitoring your search campaign and notice the changes according to the ad performance.


PPC and CPC are both the catching terms in terms of marketing campaigns; while PPC is for paid advertising, CPC is a metric that is used to measure such campaigns.  Just like PPC, CPC is also improved traffic and helps to increase the ROI. Also, it can help you note how expensive your keywords are against the earning click.

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