Internet advertising metric is a little bit chaotic these days. I personally do not favor cost per click because the metric is too dependent. Let’s revisit some of the fundamentals.

It is absolutely fine to justify your ad campaign using cost per click. However, it is equally important to realize how cost per click can be optimized. One big mistake is to take the dependent metric and then to generalize all other types of advertising. Some advertisers use CPC to justify display advertising.  Click through rate of the social network sites is famously labeled as pathetic. Well, I think all these judgments are so unfair.

What if I tell you cost per click can be optimized through CPM. Think economics, you can reduce the CPM if you increase the media buying budget. So you should be able to expand the reach, proportionally, improve the engagement opportunity. You may argue that it is the relevancy that drives the clicks and not the frequency. Relevancy is an effectiveness factor which is embedded in the nature of the media. It is a pre-requisite and it does affect the cost per click if a mistake is made in the first place.

Yes, that’s right. This is exactly what I want to say. Cost per click is a dependent metric. It is affected by many effectiveness factors like the media nature that is linked with the relevancy, size of target that is proportionally linked with cost per thousand, obviously ad creative that is the engagement vehicle. Everything puts together for the best economic result that equates the lowest cost per click.

The danger of planning your ad campaign solely focuses on bidding the cost per click is when you take away the attention from matching the right media, planning the engagement strategy, creating the right creative, you end up paying the highest CPC.

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