How to Calculate CPC of Ads Displayed on Your Blog (Cost Per Click)

CPC is the abbreviation of Cost Per Click and plays an important role in determining the net income from online ads programs like Google Adsense, Infolinks, Adbrite etc. One way to increase the income from PPC programs is to increase the CPC of the ads displaying on your website. So the question is whether we can calculate the Cost Per Click rate of advertisements shown on our blogs ?. If there is only one click, the amount you have received by that click is the Cost Per Click. It is the exact amount you will receive once a reader clicks on the advertisement shown on your webpage. However, it will be difficult to find this value if your AdSense unit received multiple clicks. If there are multiple clicks, you can follow the steps below to calculate average CPC of an ad unit.



To calculate this value, we can use two different methods. Each method is explained below with examples.

1. Calculate CPC from CPM and CTR:
   
   The formula to calculate Cost Per Click from CPM (Cost Per 1000 impressions) and CTR (Click Through Rate) is given below.
   
   CPC = CPM / (1000 × CTR)
   
   Let us consider an AdSense unit with CPM rate $10 with 2% CTR. According to the above formula, the Cost Per Click will be 10/(1000 * 2%) = 0.5
   
   If you do not know the terms in the equation provided, you are welcome to read our tutorials explaining those terms. To learn more about CTR, follow the link below.
   Steps to Calculate CTR
   
   
2. Calculate CPC from Total Earning and CTR:
   
   The average Conversion rate of a click = Total income / Total number of clicks
   
   To explain it, let us take an example. If your website received 5000 impressions on a day with 40 clicks and the net income is $15. To calculate the average CPC of the day, follow the steps given below.
   
   Average CPC of the day= Total income / Number of clicks
   
   = 15/40
   
   = 0.375
   
   As it is calculated in dollar we need to put $ in front of the output. Here the Average CPC of the day is $0.375.
   

It depends on the bid price set by advertisers as the compensation for a valid click on their advertisement displayed on your website. So it is our duty to maintain the quality of the content on our website for higher rate. We can increase the CPC of Ad units shown on our blogs if we implement the following factors.

1. Make sure your webpage is optimized with high paying keywords.
   
   
2. Too many Ad units on your webpage reduce the net Cost Per Click
   
   
3. Ads on Top and near content have higher CPC. The following link tells how to do it in a blogger blog.
   How to Insert AdSense Ads between Blog Title and Content
   
   
4. Make sure Ads on your webpage have no visibility issues
   
   
5. Getting more traffic helps to earn more with already defined CPC

If you learned how to Calculate Cost Per Click of ads showing on your blog, I recommend you to follow the link below to learn more practical uses of this term.
How Much Traffic My Blog Should Get to Earn $100 Per Day

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