Glossary
Cost Per Click (CPC)
What you pay for a single click when you buy traffic through ads. It is the price side of the paid-traffic equation.
Cost per click, or CPC, is the amount you pay each time someone clicks one of your ads. It is the price you pay for traffic, and it is only half of the picture.
The other half is what that click is worth to you, your earnings per click. Paid traffic is profitable only when what you earn per click is higher than what you pay per click.
Earnings per click > Cost per click = room to profit
Earnings per click < Cost per click = paying to lose money
A common beginner mistake is chasing the cheapest possible CPC. Cheap clicks are not automatically good clicks. A $0.10 click from people with no interest in buying is worse than a $1.00 click from people ready to purchase. What matters is the relationship between cost and value, not the raw price.
CPC is set by an auction: you are bidding against other advertisers for the same attention, so more competitive audiences cost more. To see how CPC fits the full advertising equation, read how paid advertising actually makes money.