Why your Average CPC so High and how to fix it?

A successful PPC account consists of various different elements; still, few things are more frustrating than setting up your account only to experience a high CPC limiting your number of clicks.

We shall be discussing here in this blog, what are the causes of higher CPC and the ways we can reduce them.

Actual CPC Vs. Max CPC

Before we begin our discussion, let us throw some light on what is Actual and Max CPC.

Max Cost Per Click is the maximum amount of money that you are willing to pay on a particular click.

Actual CPC, on the other hand, is the actual amount of money that you actually end up paying on per click that you receive.

For instance, if your Max bid is $3.00, still you can secure the top-most spot with the bid of $1.40. You will only have to pay $1.40 per click instead of $3.00

Though there are some other factors too that are taken into consideration while bidding, we will discuss them later in another blog.

What Causes High CPC?

It is better to know the factors that are responsible for a high CPC so that you can work to improve them.

High Competition

7SearchPPC ads run similarly to an eBay auction. The auction takes place each time someone searches for the keyword. Your bid alone determines the winner. The more people are bidding on a keyword, the more expensive it will be.

Industry

This is one thing that is out of your control, though it is vital for you to know. You can get an idea of the bids of your competitors by using your keyword search tool. Generally speaking, industries having higher per conversion value, have a higher CPC. This is because these advertisers are willing to pay more per click in the view of the prospected profits.

Let us explain this with an example, for a construction firm, one conversion means thousands of dollars for their business, so it makes sense for them to pay higher CPC. On the contrary, for a candy shop owner, one conversion will hardly generate any revenue; that is why it is not good for him to have a higher CPC.

Strategies To Lower CPC

We will now discuss a few strategies that you can use to optimize your PPC campaigns and lower your CPC costs.

Lower Bids

The best thing you can inculcate in your ad campaign is to lower your ad position. Experiment with a position 1, 2, or 3 ranks lower than your current position. Does showing at three positions below really decrease your clicks? If you are getting almost the same number of clicks, then what is the use to remain at a top-most position, as you may significantly decrease your CPC.

Long-Tail Keywords

Another effective way to curtail your CPC is to bid on keywords where your competitors aren’t. Try to bid on long keywords while still being relevant (e.g., buy whole wheat bread in Los Angeles), you will be surprised to see the difference in your CPC as very few people are bidding on it. In addition to it, you will now target only the relevant customers.