CPC vs CPM Bidding on Adwords

Posted on by in Adwords

For YouTube placements managed through the AdWords auction, an advertiser can decide to bid on a cost-per-click (CPC) or cost-per-thousand impressions (CPM) basis depending on their campaign objectives.

If an advertiser selects CPC bidding, then they will only pay when someone clicks on the ad. In comparison, for CPM bidding the advertiser pays when the ad is displayed to a user. Your bid and your landing page quality are both taken into account with CPM bidding. With CPC bidding, your clickthrough rate (CTR) is also taken into consideration.

Focus on clicks

choose CPC bidding if you:

  • have return on investment (ROI) goals.
  • wants to drive traffic to their site.
  • wants to use AdWords Conversion Tracking.

If your main goal is to have people visit your website, then clicks are a good place to start. Use cost-per-click (CPC) bidding and you’ll pay only when someone actually clicks on your ad and comes to your site.

CPC bidding gives you these choices:

  • Automatic bidding

This is the easiest way to bid. Set a daily budget and let AdWords adjust your CPC bids to bring you the most clicks possible within that budget.

  • Manual bidding

Take full control of your CPC bids. Manual bidding lets you set bids at the ad group level, or for individual keywords or ad placements, so you know you’re bidding just what you want for the clicks that mean the most to you.

Example

If you run a hiking club in Sydney, you might want to bid a lot for direct-hit keywords like “Vermont hiking” and a different amount for broader keywords like “hiking maps.”

Focus on impressions

Choose CPM bidding if you want to:

  • increase their reach.
  • increase their ad visibility.

Instead of paying by the click, you can pay by the number of times your ad is shown, if your campaign is targeting just the Display Network. That’s called cost-per-thousand impressions (CPM) bidding, since you pay for every 1,000 times your ad appears. If you’re mostly interested in getting your name or logo in front of lots of people, this is a smart option.

CPM bidding, like CPC manual bidding, lets you set bids at the ad group level, or for individual placements.

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