{"id":4458,"date":"2020-10-13T11:44:33","date_gmt":"2020-10-13T02:44:33","guid":{"rendered":"https:\/\/www.hideandseek.co.jp\/?p=4458"},"modified":"2025-10-24T14:57:02","modified_gmt":"2025-10-24T05:57:02","slug":"a-must-read-for-ad-managers-what-is-cpc-how-does-it-work-in-search-ads","status":"publish","type":"post","link":"http:\/\/www.hideandseek.co.jp\/en\/archives\/4458","title":{"rendered":"[A Must-Read for Ad Managers!] What Is CPC? How Do You Adjust It in Search Ads?"},"content":{"rendered":"

When you work in the online advertising industry,\"CPC\"<\/strong>You hear that word a lot, don't you?<\/p>\n

So in this article, we\u2019ll provide a clear explanation of what CPC means, the pros and cons of this billing model, and how to adjust CPC in paid search advertising (management strategies).<\/p>\n

 <\/p>\n

What is CPC?<\/h2>\n

CPC stands for \u201cCost Per Click,\u201d which means \u201ccost per click,\u201d and it refers to the amount a userAdvertising costs incurred for a single click on a web ad<\/strong><\/span>refers to .<\/p>\n

In other words, the formula for CPC is as follows.<\/p>\n

CPC (Cost Per Click) = Advertising Cost \u00f7 Number of Clicks<\/strong><\/p>\n

 <\/p>\n

It\u2019s clear that, for the same advertising budget, the lower the CPC, the more clicks (traffic) you can secure.<\/p>\n

 <\/p>\n

In conversation, the terms \u201cCPC 30 yen\u201d and \u201ccost per click 30 yen\u201d are often used.<\/p>\n

 <\/p>\n

Also, the billing method in which advertising costs are incurred as a result of that click is called\"CPC Billing (Pay-Per-Click)\"<\/strong>That's what they say.<\/p>\n

 <\/p>\n

In contrast, a billing method in which advertising costs are determined based on the number of times a web ad is displayed, rather than on clicks, is\"CPM Billing\"<\/strong>That's it.<\/p>\n

 <\/p>\n

This article provides a detailed explanation of \u201cCPM,\u201d so please be sure to check it out as well.
\n

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Advantages and Disadvantages of CPC Billing<\/h2>\n

\"\"<\/p>\n

Benefits<\/h3>\n

With CPC billing, advertising costs are not incurred unless a \"click\" occurs.<\/p>\n

 <\/p>\n

In other wordsReducing unnecessary clicks can help cut advertising costs<\/strong><\/span>That's it.<\/p>\n

 <\/p>\n

For example, if an ad is very eye-catching but most of the people who click on it don\u2019t convert, that means those clicks are wasted, right?<\/p>\n

 <\/p>\n

By narrowing down the age and gender of the audience to whom ads are served, or by using phrases such as \u201cA must-see for women in their 40s\u201d in the ad copy to further refine the target audience, you can ensure that only people likely to convert click on the ads. This eliminates wasted clicks and leads to improved effectiveness.<\/p>\n

 <\/p>\n

Disadvantages<\/h3>\n

Online advertising is generally based on an auction system.<\/p>\n

 <\/p>\n

In other wordsThe more competitors there are, the higher the bid prices become, which in turn drives up the cost per click.<\/strong><\/p>\n

 <\/p>\n

For example, with search ads, the more advertisers bidding on the same keyword, the higher the CPC; and with display ads, the more advertisers targeting the same audience segment, the higher the CPC.<\/p>\n

Four Methods for Adjusting CPC in Search Ads (Bid Adjustments)<\/h2>\n

\"\"<\/p>\n

 <\/p>\n

There are four main methods for adjusting CPC in paid search ads.<\/p>\n

\u2460 Adjust bid prices so as not to exceed \u201cTarget CPA \u00d7 CVR\u201d<\/h3>\n

The first method involves directly raising or lowering your bid price.<\/p>\n

(*In this case, you must set the campaign's bidding strategy to \"Manual.\"*)<\/p>\n

 <\/p>\n

For search ads, you can adjust bid amounts by keyword or ad group; for display ads, you can adjust bid amounts by ad group.<\/p>\n

 <\/p>\n

Adjusting it is very simple.<\/p>\n

 <\/p>\n

Bid price\"Target CPA \u00d7 Current CVR\"<\/strong>Set it so that the result does not exceed the figure calculated above<\/span>I will.<\/p>\n

 <\/p>\n

For example, if the target CPA for a product is 10,000 yen and the CVR for keyword A is 1.5%, then<\/p>\n

 <\/p>\n

10,000 \u00d7 0.015 = 150<\/p>\n

 <\/p>\n

The maximum bid for Keyword A is 150 yen.<\/p>\n

 <\/p>\n

If the CPC for Keyword A exceeds 150 yen, the CPA will increase, so adjust your bid to keep it at or below 150 yen.<\/p>\n

 <\/p>\n

If there is a discrepancy between the conversion count in the admin panel and the actual conversion count, there is a discrepancy in the CVR, so that discrepancy rate must also be factored into the calculation.<\/p>\n

 <\/p>\n

\u2461 Adjust the bid price based on the \u201cestimated bid price\u201d<\/h3>\n

The second method also involves directly increasing or decreasing the cost per click.<\/p>\n

(*In this case, you must set the campaign's bidding strategy to \"Manual.\"*)<\/p>\n

 <\/p>\n

In Google Ads, in the keyword management interface,<\/p>\n

 <\/p>\n

\u30fbBid Price Adjustment (Page 1)<\/strong>
\n\u30fbAd Bid Adjustment (top of the page)<\/strong>
\n\u30fbBid Price Adjustment (Top Position)<\/strong><\/p>\n

 <\/p>\n

In Yahoo! Ads, in the keyword management interface,<\/p>\n

 <\/p>\n

\u30fbBid price required for placement on the first page<\/strong>
\n\u30fbBid price required for placement at the top of the first page<\/strong><\/p>\n

 <\/p>\n

You can check the display items listed below.<\/p>\n

 <\/p>\n

For now,If it doesn't appear on the first page, the number of views will drop dramatically<\/span>So,Generally, \u201cBid Price Adjustment (Page 1)\u201d and \u201cBid Price Required for Page 1 Placement\u201d serve as the minimum benchmark for bid prices.<\/strong>Let's say that's the case.<\/p>\n

 <\/p>\n

However, if the estimated bid price listed on the first page is higher than the amount calculated as \u201cTarget CPA \u00d7 CVR,\u201d it will exceed the Target CPA; therefore, we generally adjust it to match the amount calculated as \u201cTarget CPA \u00d7 CVR.\u201d<\/p>\n

 <\/p>\n

Additionally, if the amount calculated using \u201cTarget CPA \u00d7 CVR\u201d is higher than the estimated bid price for the top position or the top of the first page, lower your cost per click to the estimated bid price for the top position or the top of the first page.<\/p>\n

 <\/p>\n

This is done to lower the average cost per click for that keyword.<\/p>\n

\u2462 Set up exclusions for low-performing search queries<\/h3>\n

Strictly speaking, this isn\u2019t a method for lowering CPC but rather for lowering CPA; however, I\u2019ll also explain this adjustment method.<\/p>\n

 <\/p>\n

First, as a basic introduction to the terminology,<\/p>\n

 <\/p>\n

Keyword = A string of characters set by the advertiser in the admin panel<\/strong>
\nQuery = The string the user actually entered in the search<\/strong><\/p>\n

 <\/p>\n

Please keep in mind that there is a difference.<\/p>\n

 <\/p>\n

In the admin panel, you can check the queries associated with a keyword by selecting that keyword.<\/p>\n

 <\/p>\n

HereIdentify queries with skyrocketing cost-per-conversion, queries that are driving up costs without generating conversions, and queries that are completely unrelated to your target keywords, and set them as negative keywords.<\/strong><\/p>\n

 <\/p>\n

Excluding keywords reduces unnecessary spending, which lowers the cost per conversion.<\/p>\n

 <\/p>\n

Furthermore, as your overall CPA decreases, you\u2019ll have more leeway, and you\u2019ll also be better positioned to raise your bid price and win auctions.<\/p>\n

 <\/p>\n

Furthermore, since this allows you to maximize the number of conversions within your target CPA, be sure to do it.<\/p>\n

 <\/p>\n

\u2463 In retargeting, set the bid price lower as the number of days increases<\/h3>\n

Retargeting is an advertising technique that displays ads to users who have previously visited a landing page.<\/p>\n

You can set the number of days after a user\u2019s site visit during which ads will be displayed, and it\u2019s common to divide ad groups by these time periods.<\/p>\n

 <\/p>\n

This is because interest in the ad (and in the product) tends to wane with each passing day after a visitor arrives at the site.<\/p>\n

In other wordsThe shorter the duration, the higher the CVR<\/strong><\/span>\u3001The longer the duration, the lower the CVR<\/strong><\/span>That's right.<\/p>\n

 <\/p>\n

ThereforeThe shorter the duration, the higher the cost per click<\/strong>\u3001Set the cost per click lower as the number of days increases<\/strong>Let's do it.<\/p>\n

 <\/p>\n

We explain retargeting in detail below.<\/p>\n\n

<\/a>
Pz-LinkCard<\/div>
- Incorrect URL specification.
- URL=<\/div><\/div><\/div>\n\n

 <\/p>\n

Maximum CPC and Expanded CPC<\/h2>\n

\"\"<\/h3>\n

What Is a Maximum CPC?<\/h3>\n

To avoid a situation where your CPA suddenly skyrockets without you realizing it on Google Ads or Yahoo! Ads, be sure toDaily BudgetThe maximum daily budget. The monthly budget is calculated by multiplying the daily budget by 30.4 (the average number of days in a month). (Example: Daily budget of 10,000 yen \u00d7 30.4 = monthly budget of 304,000 yen)<\/span><\/span>You must set your bid price.<\/p>\n

 <\/p>\n

In that context, setting a limit such as \u201cDo not bid at a higher cost-per-click than this\u201d isMaximum CPC<\/strong>That's it.<\/p>\n

 <\/p>\n

For campaign bidding strategies, select \u201cIndividual CPC\u201d in Google Ads, or \u201cManual Bidding: Individual CPC\u201d in Yahoo! Ads, andYou can set the maximum CPC for each ad group and keyword yourself.<\/strong><\/p>\n

What Is Expanded CPC?<\/h3>\n

Extended CPC<\/strong>This means that, based on historical data, the amount set as the maximum CPC is,To maximize cost-effectivenessAutomatically raise and lower bid amounts<\/span>Features that do this<\/strong>That's it.<\/p>\n

 <\/p>\n

For example, even if you set the maximum CPC to 120 yen, if the AI determines that bidding 140 yen will increase conversions, it will automatically bid 140 yen; conversely, if it determines that anything less than 80 yen will be ineffective, it will automatically lower the bid to 80 yen.<\/p>\n

 <\/p>\n

Since it automatically makes fine adjustments to bid prices,Can reduce operational time<\/strong>In addition,It automatically increases the number of conversions<\/strong>That is the advantage.<\/p>\n

 <\/p>\n

Therefore, if you have set your bids to manual, we generally recommend keeping the extension turned on.<\/p>\n

 <\/p>\n

However, since Google's Enhanced CPC was discontinued in October 2024, it is no longer possible to set up Enhanced CPC.<\/p>\n

If you are currently using expanded CPC in an existing campaign, you can continue to use it until March 2025. However, please note that after that, your campaign will automatically switch to individual CPC.<\/p>\n

 <\/p>\n

Please check the official Google website for details.<\/p>\n

See: Google Ads HelpAbout Enhanced Cost Per Click (eCPC)<\/a><\/span><\/span><\/p>\n

 <\/p>\n

Lowering CPC isn't the only thing that matters<\/h2>\n

\"\"<\/p>\n

 <\/p>\n

Since the return on ad spend (ROAS)\u2014calculated as \u201crevenue \u00f7 ad spend\u201d\u2014is used to measure the cost-effectiveness of advertising, it is directly related to the cost in the denominator.It\u2019s often thought that lowering CPC is very important<\/span>That's it.<\/p>\n

 <\/p>\n

However,Lowering your CPC could cause you to lose out in auctions, resulting in fewer impressions and potentially fewer conversions.<\/strong><\/p>\n

 <\/p>\n

The important thing isIncrease the number of conversions that can be acquired within the target CPA<\/span><\/strong>That's it.<\/p>\n

 <\/p>\n

To maximize the number of conversions, don\u2019t just set a low CPC\u2014also make sure to target the ad groups and segments where you can acquire conversions at a low CPC.<\/p>\n

Therefore, it is necessary to carefully review the keywords and queries mentioned above.<\/p>\n

 <\/p>\n

If you\u2019re acquiring conversions within your target CPA, consider raising your CPC to increase impressions, or allocate part of the budget to test whether other keywords can generate similar results based on the gross profit earned from that keyword, and make adjustments to increase the number of conversions.<\/p>\n

 <\/p>\n

Also,To increase the number of CVs,Increasing the CVR is essential<\/span><\/strong>That's it.<\/p>\n

 <\/p>\n

This article explains CVR and offers suggestions for improvement, so please be sure to check it out.<\/p>\n

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\"\"<\/div>
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