ScaleyCPC Calculator: Cost per Click
CPC (cost per click) is what you pay, on average, for one click on your ad. The formula is ad spend divided by clicks. Spend $500 and get 400 clicks, and your CPC is $1.25. The most you can afford per click is what one order leaves you after product, shipping and fees, times your conversion rate.
How to Calculate Cost per Click
- CPC
- ad spend / clicks
- CPM
- ad spend / impressions x 1,000
- CTR
- clicks / impressions x 100
- CPC from CPM
- CPM / (CTR% x 10)
- Max CPC
- target cost per sale x conversion rate
The CPC in your Google Ads report is an average. Some clicks cost more, some less. Spend divided by clicks gives you that average.
You set a max CPC, the most you will pay. But Google's own help says you are often charged less, sometimes much less. You pay what it takes to keep your spot, not your full bid.
CPM is the cost of 1,000 impressions. If you know your CPM and your click-through rate, you can get to CPC. 1,000 impressions at a 2% CTR bring 20 clicks. So CPC is CPM divided by 20.
Three Worked Examples
A Shopping Campaign, Read Properly
Last 30 days: $1,240 spend, 1,550 clicks, 62,000 impressions.
- CPC: $1,240 / 1,550 = $0.80
- CPM: $20
- CTR: 2.5%
Cheap clicks are only good news if they buy. Check the CPC against the max CPC you can afford, not against someone else's store.
From CPM and CTR
A YouTube or Display report shows an $18 CPM and a 1.5% CTR.
- Clicks per 1,000 impressions: 1.5 x 10 = 15
- CPC: $18 / 15 = $1.20
Same money, two views. Handy when one report gives CPM and you want to compare it with Search, which runs on clicks.
The Most a Dropshipper Can Pay per Click
Your break-even cost per sale is $24. 2.5% of your clicks buy. Break-even cost per sale is what you keep from one order after the product, shipping and fees. Not sure? The break-even ROAS calculator works it out.
- Clicks per sale: 100 / 2.5 = 40
- Max CPC: $24 x 2.5% = $0.60
Pay more than $0.60 a click on average and the average sale loses money. Lift the conversion rate and that ceiling goes up with it.
What Is a Good CPC
It depends, and anyone with one number for you is guessing. CPC changes with your country, your product, your competition, the time of year and your Quality Score. Under the pay-per-click model you are often charged less than your bid.
The useful question is not "is my CPC low". It is "is my CPC under the most I can afford". That ceiling is your target cost per sale times your conversion rate. Use the third tab.
A higher CPC can be fine. A $2 click that buys 1 time in 20 beats a $0.40 click that buys 1 time in 200.
Which Cost Number to Watch
CPC is cost per click. CPM is cost per 1,000 impressions. CPA is cost per acquisition, the ad cost of one sale. Every metric pair side by side, with the formula for each: PPC metrics compared.
- CPA = CPC / conversion rate. A $1 click at 2% means $50 of ad cost per sale.
- Search and Shopping charge per click.
- For an online store, CPA is the one that pays the bills. CPC and CPM are on the way there.
Common Mistakes
Chasing the cheapest clicks
Low CPC with no sales is just cheap waste. Judge clicks by what they cost per sale.
Setting max CPC with no math
Work it out from your cost per sale and conversion rate. Then you know the real ceiling.
Comparing your CPC with a forum post
Another store's CPC is in another country, niche and month. It tells you very little about yours.
Ignoring Quality Score
Google calls Quality Score an estimate of the quality of your ads, keywords and landing pages. Better quality can mean a better spot at a lower price.
Reading CPC for one day
A day is too short. Read it for a full week before you move a bid.
Questions People Ask
Divide your ad spend by your clicks. $500 spend and 400 clicks is a CPC of $1.25.
More Free Tools
Clicks getting pricier and you can't see why? Send Scaley Consultant the screenshot and get a straight answer.
$99/mo flat. 3-day free trial. Card required. Cancel anytime.