Cost per click (CPC) is the amount an advertiser pays each time a user clicks an ad, set in real time through an auction. The auction runs on the major ad platforms (Google Ads, Meta, Microsoft Ads, LinkedIn, TikTok, Amazon) and varies widely by industry, keyword, audience targeting, ad quality, and competitive intensity. It is the unit price of paid traffic and the most-watched number on a paid-acquisition team's daily dashboard. It is also one of the easiest metrics to over-optimize.
CPCs are set by auction, not by list price. On Google Ads, the auction takes the advertiser's max bid and multiplies it by Quality Score (a 1 to 10 measure based on expected click-through rate, ad relevance, and landing-page experience) to dete...