CPC or cost per click is an advertising pricing model that places a value on each click an ad receives. Advertisers bid on ad space by setting a maximum amount they are willing to pay for each click.

Why Do You Need to Understand CPC?

Google, LinkedIn, Facebook and other advertising providers use the CPC model to price clicks on the ads they display. These ads may be shown beside search results on Google (as shown below), Bing, or other search engines, or in social activity streams on Facebook, Twitter, or LinkedIn. It is important to understand the price model to ensure your ad campaign earns the best return on your investment. The other type of price model most common is CPM, or cost per thousand impressions.

Google displays CPC ads on their Search homepage.