Cost per Click is a term that is often tossed around in digital marketing, which refers to a bidding model where you pay for every click you get on your ad. In other words, this term embodies the value of each click an affiliate marketing lead makes on one of your ads online, be your PPC campaigns on social media platforms or Google’s ad networks.

This model is vital to your success as a digital marketer as this metric shows you how much you pay per click, shows what you actually pay per click, and gives you insight into whether you should lower your advertisements’ CPC rate.

Dive into what determines the health of your affiliate campaigns’ click rate below!

• How to calculate Your CPC
• What affects Your Rank
• Ways to lower Your CPC Rate

How to calculate Your CPC

When we are discussing how to calculate your campaigns’ CPC affiliate marketing rates, there are two effective formulas to take into account. The first one determines how much you can expect to pay each time somebody clicks on your ads.

(Ad Rank of the Ad Below Yours/Your Quality Score) + $0.01 = CPC

The second formula helps you figure out where you stand in comparison to the average click cost of other ads in your niche market and platform of choice.

Total CPC / Total Clicks = Average CPC

The next step requires you to compare your average cost per click against the average in your niche market or on the platform you have chosen onto which you uploaded your ad. For example, PPC eCommerce ads on Google’s search network have an average cost of $1.16, whereas advertisements on the display network are only $0.45 per click.

What affects Your Rank

Several aspects can influence your ad’s ranking on Google’s ad networks, some of which are under your control. The others leave your fate in the merciful hands of much greater forces. Listed below are the factors that affect your ranking and your CPC rate the most.

• Max Bid. The maximum price you are willing to pay per click on your ad.
• Quality Score. Based on your keyword relevancy, landing page quality, and click-through rate (CTR), your campaigns are put to the test and get a certain score.
• Ad Rank. The bid amount, the quality of your ad at auction time, and the relevancy of the affiliate marketing lead’s search further contribute to your ad ranking.

This may come as a surprise, but the lower your creative campaigns rank, the higher your CPC is going to be. If that does not light a fire under you to get your materials to the highest level possible, we are not quite sure what will.

Ways to lower Your CPC Rate

In order to combat high CPC affiliate marketing costs, you will need to shift your focus and decipher how you are going to move forward. Some of the best methods at your disposal are the following:

• Redefine Your Audience. We have spoken about targeting your desired audience correctly on so many occasions, and here it becomes clear as to how you may be wasting your time and energy if you do not.
• Create Relevant Ads. Give your quality score a much-needed boost by choosing keywords with the highest relevance to ensure a great CTR. This factor is also extremely important when it comes to social media platforms, as they push for relevant ads even harder.
• Use Detail-Specific CTAs. A call to action (CTA) is a crucial part of any ad, as it guides your leads on how to move forward and what to expect next. Moreover, the more engaging your CTA is, the better your whole campaign will perform.

By taking all of the factors above into consideration, you should be able to create a high-performing CPC affiliate marketing campaign. Although it may be challenging to keep everything up to par, it will become much easier as you progress in your career as an affiliate marketer.

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