Hello, community! In affiliate marketing, there are many payment models by which advertisers will settle with you. However, there is one model that affiliates themselves use to pay for traffic. We’re talking about CPC, which we will review today.

But before we start, we want to remind you that we always talk about how and by which schemes people make money in affiliate marketing. In particular, we recommend checking out our RevShare review, where we discussed all the nuances of this model.

What is CPC?

CPC (Cost-Per-Click) is a payment model where the advertiser pays a fixed price for every click on an ad. In our case, we are the advertiser.

On the other hand, some experts refer to CPC not as a payment model but as a metric. Overall, this view is also valid. After all, CPC is one of the factors when calculating your ROI, and in this context, we will use CPC as a metric, indicating the cost per click when shaping your budget vision for a campaign.

In any case, the most important thing for us is to understand that when we talk about CPC, we mean the cost per click on an ad.

How does CPC work?

CPC is a highly popular advertising model present in most modern networks: from Google and Facebook to Amazon and many lesser-known projects. Everywhere we will set how much we are willing to pay per click on our ad. In some cases, the advertising platform will set prices on its own. And here, we see the first feature — pricing.

The most objective, which is why it has become the most widespread, is the auction model. We’ve already covered this model in detail in our article on bidding, so go check it out! To summarize, the auction model in CPC is the process where the system selects a pool of ads based on the price offered by affiliates. The higher your bid, the better the chance to enter the active pool, and the more people will see your ad.

Key factors that affect both the cost per click and the number of clicks are as follows:

  • Your bid and its size
  • The quality of your ad and its relevance to traffic queries
  • Competition, which makes advertising in top niches extremely expensive

You will only pay when a lead clicks on your ad. Therefore, your actual reach will be higher than the number of clicks, which is generally good.

Pros and Cons of CPC

We hope we’ve explained the key features of how CPC works clearly and concisely. Now let’s look at the pros and cons of this model. Let’s start with the pros:

  1. Flexibility in targeting. Most networks allow you to set various characteristics for your audience, ensuring you pay only for relevant traffic.
  2. Pay only for results. You pay only when a click occurs, so the rest depends on the quality of your landing page and offer.
  3. Efficient budget management. Advertising is the key expense category for every affiliate. In a limited budget, working with CPC becomes highly beneficial and even comfortable.
  4. Easier to calculate results, forecast profits, and expenses. CPC is predictable, so when it comes to counting money, you won’t encounter any surprises.

But not everything is so rosy, because otherwise, there wouldn’t be any other payment models for advertising, right? Among the cons, the following stand out:

  1. High cost of advertising, especially when driving traffic from top platforms to top niches.
  2. Risk of falling victim to fraud. When working with lesser-known networks, you need to pay special attention to the quality of traffic before starting the campaign.
  3. Constant need for optimization. To keep profits consistently high, you’ll need to always optimize your campaign: manage click prices, adjust targeting, and test creatives. Otherwise, making money will be difficult.

Nothing in the world is perfect. So CPC isn’t an exception and also has its drawbacks. However, compared to competitors like CPM, CPC is still more profitable, even if it costs more.

Conclusion

Paying for clicks on ads is the most optimal way to acquire targeted traffic. Depending on your niche, the cost of the campaign will vary. The higher the competition, the more expensive the advertising, as this is how CPC works, especially in auction bidding.

What do you prefer: CPC or CPM? Don’t know what CPM is but want to learn? Then write to us in our Telegram community, because we base our article ideas on what interests our readers!

As always, with respect, your Geek!

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