Google AdWords has probably been one of the most sensational and substantial parts of businesses in the past few years. Although for the amateurs it might get a bit tricky to handle, once you get the hang of it, it proves to be very beneficial.
This section gives you an idea about how Google AdWords Cost per Click works and how to reduce Google AdWords cost per click.
Let us first understand the idea about cost per click.
What do we mean by Cost per Click?
We all know that the concept behind Google AdWords is displaying advertisements for your company or business to increase sales or receive organic traffic as a part of your online marketing strategy. But what most of us are not aware of is that Google receives money for these kinds of advertisements that are displayed. How?
This is where the concept of cost per click or CPC comes in which is basically the cost that is incurred by every business that has to be paid to Google or any other search engine for that matter when their advertisements are being clicked on by someone. It is the basic foundation that helps you understand Google AdWords Campaign in a much better manner as it gives you the cost per click of your advertisement.
The formula for CPC can be given as CPC = Total Spend ÷ Total Clicks
There can be two types of CPC:
- Actual CPC
- Maximum CPC
Actual CPC is the final amount of cost that you have to pay per click on your advertisement whereas maximum CPC is the highest cost that can be possibly charged to you for your ad display. Usually, the actual cost per click value is much lesser than the maximum cost per click but it might even exceed in case you are using enhanced CPC or any adjustments in your bid amount.
Keeping in mind these basics, we move on to ways in which the cost per click can be kept at a minimum.
How to reduce Google AdWords Cost per Click?
In order to successfully reduce the cost per click in Google AdWords a few basic rules need to be set and followed which are given below:
Adding highly specific keywords
Highly specific or long tail keywords addition instead of generic keywords is one way to decrease your CPC. Long tail keywords are those kinds of keywords which are not too commonly searched and therefore, the search intent behind these keywords can be clearly identified as compared to generic keywords. This helps in increasing your quality score, thereby reducing CPC.
Avoid using Competitive Keywords
The more competitive your keyword is the higher the bid is on your CPC. So, when using keywords, make sure that the keywords have a low bid on them.
Always use manual bidding of CPC instead of automatic. If you are using automatic CPC bidding, chances are that you are being charged a higher CPC. Switch to manual bidding to get a greater control over your CPCs and help them to get reduced.
Emphasize on negative keywords
Negative keywords are the basis of a lower or higher Click through Rate (CTR). The lesser the negative keywords, the lesser your CTR gets lowered due to irrelevant searches and the lesser the quality score becomes. This automatically means that your CPC will increase. Hence, the more negative keywords you shall use, your advertisement’s CPC will not be triggered by unnecessary search queries which will help you maintain a higher CTR leading to a good quality score and automatically decreasing your CPC.
Focus on Ranking & Quality Score
Your position on the Google Ad Rank is based on your keywords, landing pages, and ad copy. All these give you a certain Quality score based on which your ranking is determined. If you are able to manage a high-quality score, then no one can stop you from aiming 3rd or 4th ranks in Google leading to a lower CPC.
Find out what works
This basically means that in order to get a high-Quality Score to find out what tricks you can apply such as separating and segregating each of your different products into specific groups and making them tightly themed. Or scheduling your advertisements in such a manner that the ad clicks are not irrelevant thereby decreasing the CPC. Or targeted geo-tagging which helps you improvise your ads to the area-specific target audience which eventually improves your CTR with relevant clicks leading to increasing quality score and reduction of CPC. Other ways can be conversion tracking or even using advertisement as extensions or adjustment bidding and so on.
Your basic target is to reduce ad spending by reducing the CPC but not the ultimate target. Improving other aspects in your AdWords campaign might also be one of the ways in which spending can be reduced.
Also published on Medium.