Immediately, I know exactly what you are thinking, ‘how can a high CPC in PPC be a good thing?’. With this question, I understand
where you are coming from. In many PPC campaigns, one of the objectives of an advertiser is to make sure the cost per click is relatively low so that the advertiser will get more clicks for his/her money and the the lifespan of the campaign can be prolonged on the same budget. However, a low CPC is not always a good thing to have in PPC. In fact, in some cases, it is better to accommodate a high CPC rather than a low CPC. This will be explained below.
In essence, when looking at the CPC in PPC, you have to take into account the factors which will affect the CPC for that  campaign:
- Competition – Depending on how many other advertisers bidding in your market will determine the CPC you have. It comes from the old saying ‘supply and demand’. For example, the demand for ad space is more than the supply for ad space. Hence, the price for the ad space increases.
- Websites – If you have adverts on publisher websites of PPC such as Adsense, your cost per click will increase depending on the quality of website your advert is appearing on. In basic terms, the higher the page rank of the website you advertise on, the more you are likely to pay for an ad space on that website.
For this reason, when you have a low CPC, this either means:
- The competition from other advertisers is low.
- The website you are advertising on is poor.
It is either one of these two reasons. The first reason links in with niche keywords since if your campaign is based around niche keywords, your competition is going to be low so your CPC will be low. However, if you have a campaign with a low CPC and no niche keywords, you should expect that your advert is being displayed on poor websites with irrelevant low quality content.
For this reason, from adopting a high CPC strategy for your PPC campaign, you will get the below benefits:
- For search – You will outbid all competitors making sure your advert gets the most exposure to your target market.
- For search – Your advert will be above all other PPC search adverts as well as organic adverts, making it much more likely for your target market to see your advert and click on it.
- For display adverts – Your advert will get the most exposure on publisher websites since you are outbidding competitors for the same ad space.
- For display adverts – A higher CPC will enable your campaign to appear on better quality websites which have better and more relevant traffic which could result in a much better conversion rate.
Therefore, a low CPC is good for some situations. A high CPC is generally always good in most situations.
