What cost per click means
Cost per click (CPC) is what you pay for one click on an ad. With CPC bidding, as Google Ads Help puts it, you pay for each click on your ads, and the final amount you are charged for a click is your actual CPC (Google Ads Help: Cost-per-click). Because every click can cost a different amount, reports show the average. Google defines average CPC as the total cost of your clicks divided by the total number of clicks (Average cost-per-click).
The formula has three parts, so you can solve for any one of them. The calculator does this with the "Solve for" switch.
Max CPC, actual CPC and average CPC
Three CPC terms show up in ad accounts, and they are easy to mix up:
- Max CPC is your bid: the highest amount you are willing to pay for a click (Google Ads Help: Maximum CPC bid).
- Actual CPC is the final amount charged for one click. Google says it is often less, sometimes much less, than your max CPC. In the auction you pay what it takes to clear the Ad Rank thresholds and to beat the Ad Rank of the advertiser directly below you (Actual cost-per-click).
- Average CPC is the actual CPCs of all clicks added up and divided by the clicks. This is the number this calculator works with.
A click normally does not cost more than your max CPC, but Google names exceptions, such as bid adjustments, where the actual CPC can be higher. Since the price is set in each auction, we do not list "average CPC" figures by industry here. Your own account history for the same keywords, audience and period is the benchmark that counts.
A worked example
A search campaign cost $600.00, was shown 48,000 times, got 1,200 clicks and 36 sign-ups.
- Average CPC: $600.00 ÷ 1,200 = $0.50 per click.
- CTR: 1,200 ÷ 48,000 × 100 = 2.50%. CPM: $600.00 ÷ 48,000 × 1,000 = $12.50.
- Conversion rate: 36 ÷ 1,200 × 100 = 3.00%. Cost per conversion: $600.00 ÷ 36 = $16.67.
- Budget: at the same CPC, $1,000.00 buys about $1,000.00 ÷ $0.50 = 2,000 clicks.
CPC, CPM and CTR are tied together: CPC = CPM ÷ (CTR × 10) with CTR in percent, here $12.50 ÷ (2.5 × 10) = $0.50. So if you buy impressions, a better click-through rate lowers what each click costs you. The CTR calculator works out clicks and impressions and compares ads, the CPM calculator plans a budget from impressions, and the ROAS calculator checks whether the revenue covers the spend.
Max CPC from a target CPA
If you know what a conversion may cost, you can work out what a click may cost. Of every 100 clicks, the conversion rate tells you how many convert. Those conversions must not cost more than the target in total, which gives the formula:
With a target of $25.00 per sign-up and a 3.00% conversion rate, the example campaign can pay up to $25.00 × 0.03 = $0.75 per click on average. Its actual average CPC of $0.50 is below that, which is why its cost per conversion, $16.67, is below the target too.
Where does the target come from? One way to set it is what a conversion is worth to you after costs: the profit on an average order, or the share of leads that turn into customers times what a customer brings in. At that CPA the ads exactly break even, so set the target below it if the ads should earn money. A conversion rate can change from week to week, so use a rate from enough clicks to be stable, and check it again when you change the landing page or the offer.
Bidding systems can do this math for you. Google Ads Help describes Target CPA as the average amount you would like to pay for a conversion, and notes that some conversions may cost more than your target and some less (About Target CPA bidding). The formula here is useful either way: it shows whether a manual bid or the CPC you see in your reports fits the target.
Common mistakes
- Averaging CPCs. $0.25 and $1.50 average $0.88, but if the first campaign got 400 clicks for $100.00 and the second 600 for $900.00, the real average is $1,000.00 ÷ 1,000 = $1.00. Add up spend and clicks first.
- Mixing date ranges. Take the spend, clicks and conversions from the same period and the same campaigns, or the ratios mean nothing.
- Confusing your bid with your cost. A max CPC of $1.00 does not mean you pay $1.00 per click. Plan budgets with the average CPC from your reports.
- Judging by CPC alone. Cheap clicks that never convert cost more per customer than expensive clicks that do. Look at the cost per conversion next to the CPC.
How to use the CPC calculator
- 1Choose what to solve for: the CPC of a campaign that ran, the ad spend for a number of clicks, or the clicks a budget buys.
- 2Enter the two numbers you know, using totals from your ads account for the same date range.
- 3Add impressions and conversions to see CTR, CPM, conversion rate and cost per conversion.
- 4Enter a target CPA to get the max CPC that meets it, then copy the result or a link that keeps all your numbers.
Frequently asked questions
How do you calculate CPC?
Divide the ad spend by the number of clicks. A campaign that cost $600.00 and got 1,200 clicks has an average CPC of 600 ÷ 1,200 = $0.50. Google Ads Help calculates average CPC the same way: the total cost of your clicks divided by the number of clicks.
What is the difference between max CPC and average CPC?
Max CPC is a bid: Google Ads Help defines it as the highest amount you are willing to pay for a click. Average CPC is what you were actually charged, on average, for each click. Google says you are often charged less than your max CPC, sometimes much less, so your average CPC is usually below your bid.
Can a click cost more than my max CPC?
Normally no. Google Ads Help says a click will not cost more than the max CPC bid you set, but it names exceptions, such as bid adjustments, where the actual cost of a click can be higher than the max CPC.
How do I work out a max CPC from a target CPA?
Multiply your target cost per conversion by your conversion rate. If a conversion may cost $25.00 and 3.00% of clicks convert, you can pay up to $25.00 × 0.03 = $0.75 per click on average and still hit the target.
How many clicks will my budget buy?
Divide the budget by the average CPC you expect and round down. $1,000.00 at $0.50 a click buys about 2,000 clicks. Choose Clicks under "Solve for" to work it out. It is an estimate, because the CPC changes from auction to auction.
Can I average the CPCs of several campaigns?
No, add up the spend and the clicks first. A campaign with $100.00 for 400 clicks ($0.25) and one with $900.00 for 600 clicks ($1.50) average $0.88, but together they cost $1,000.00 for 1,000 clicks, a real average CPC of $1.00.