There are many platforms to run PPC campaigns, and you have virtually unlimited options to customize your campaigns and refine your targeting. However, there is always a potential issue or challenge that needs to be addressed. It's just part of the deal.
In this article, we'll discuss the possible causes for the spike in your ad's CPC and effective ways to deal with the problem. While we'll focus primarily on Google Ads and Facebook ads for specificity, the information provided can be extended to any other web or social media advertising platform.
What Is Considered a Healthy CPC?
The ideal CPC might not exist as it varies across industries. Generalizing based on global statistics means excluding the nuances inherent in each market while ignoring a two-dimensional variation: within sectors and between regions. With that in mind, inspecting different industries and their CPC is still useful. It will give you an insight or a ballpark of what is considered an acceptable cost per click in your category.
Wordstream found that financial advertisers have the highest CPC on Facebook at $3.77 per click, with the cheapest clicks reserved for the apparel ($0.45 per click) & travel and hospitality ($0.63) industries.
Unlike Facebook ads, where details about the audience matter the most, keywords are the driving force behind the CPC in Google Ads. The average CPC is still only a partial measure of what to expect. Industry averages vary, and how they vary varies.
Advertisers across all industries, for example, pay an average of $2.69 per click on search ads and $0.63 for display ads. Depending on the type of Google ad you're looking to run — search, display, product listings, etc. — benchmarking with the relevant data can help ascertain what your target keywords would cost.
Now That We Have Established a Baseline, Let's Explore What to Do When Your CPC Skyrockets
Avoid audience overlap
Audience overlap occurs when the same target audience appears in multiple ad groups of your campaign. It means you'd be paying twice to reach the same people once. No brand wants to compete against itself, yet that's what happens here. And the wider the overlap, the higher your CPC will be.
Using the Facebook Audience Overlap tool — which you'll find under Audiences on your Facebook Ads Manager — you can select up to five groups of audiences to compare and adjust your targeting accordingly.
Optimize for higher relevance & quality scores
Relevance score is a magic number that ranges between 1 and 10, with a score of 10 translating to ads that are most relevant to the intended audience. It is quite simple to check for the relevance score of each of your Facebook ads: it sits on the right of the Facebook Ads Manager dashboard in a column titled: Ad Relevance Diagnostics.
Facebook emphasizes optimal user experience and, for every audience category and subcategories, prioritizes relevant advertisements over less pertinent ones. The more positive interactions an advertisement gets, the higher the score.
Accordingly, the score directly influences the CPC for Facebook advertising. It determines how your ad's perceived quality and expected engagement and conversion rates compare to other ads competing for the same audience. Thus, it remains in your financial interest to ensure your Facebook ads are crafted precisely for your target audience — from the wordings of the ad copy to the aesthetic of the visuals.
Quality score, in contrast, is to Google Ads what relevance score is to Facebook ads. The score is affected by factors like CTR, ad relevance, and landing page experience.
The more these elements worsen, the higher your CPC will be. It is impossible to directly change the quality score. However, Google Ads did an excellent job detailing how advertisers could use quality scores to improve campaigns. Most often, optimizing for a higher quality score is all you need to stabilize your CPC.
Improved CTR in any PPC campaign will yield a lower CPC. Why? When an ad's CTR is healthy, the quality or relevance score will increase for Google Ads or Facebook ads, respectively. As we've seen, a higher score means that your ads contribute to a better user experience. Ad platforms reward this effort by lowering your ad's CPC.
There are many ways to improve CTR in PPC campaigns. The trick is to focus on selling a click — not the product — and allow your landing page to take care of the rest.
Implement anti-ad fraud solutions
Ad fraud is the primary culprit of mysterious, increased ad spend in general and that of CPC in particular. The number of reported ad fraud cases in the digital advertising market has grown exponentially in recent years. One report revealed that 11% of search ad clicks and as much as 36% of all display ad clicks are fraudulent.
This can be solved by constantly monitoring your campaigns and banning suspicious traffic. Unfortunately, manual inspection is both time consuming and riddled with inaccuracies, rendering the method ineffective. The best alternative will be to implement an automated system for detecting and preventing ad fraud, thereby reducing your CPC.
>> Related article: 6 Benefits of Deploying an Ad Fraud Prevention Tool
Take note of trends and holidays
Timing can also affect your CPC. Black Friday shopping seasons, holidays, and elections in your targeted regions — depending on what you're promoting — can all trigger an even more competitive advertisement climate around keywords and audience groups. It could explain why your campaign's CPC suddenly rose, even as all other parameters remained the same.
Advertisers could temporarily pause their ad campaigns, if their timeline permits it, and then resume once the timing is appropriate.
Trends play a huge role in the spike of CPC in ad campaigns. A prominent figure endorsing a particular brand, relevant breaking news around your keyword, etc., might affect consumer behavior or trigger competitors to want to seize the day with regards to the audience or keywords you just so happen to be targeting. This would usually lead to a sharp rise in CPC.
Out of the reasons outlined, however, a sudden and unusual spike is almost always fraudsters duping advertisers in one way or the other. These frauds could cost your business lost revenue and tarnished image; in many extreme cases, no amount can make up for the damages they cause. Not only do ad fraud prevention tools guard you against such attacks, but they can also help you optimize your entire marketing efforts paving the path to sustainable growth.
>> It doesn't take much to protect your campaigns and get your ad CPC under control. Start your fraud-free journey with Spider AF's 14-day free trial today!