What are CPC, PPC, CPM and CTR

You need to know these pricing models. CPC, PPC, CPM or CTR are crucial for digital marketing.

Author: Saqlen Mehdi

Published: 2 years ago

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What are CPC, PPC, CPM and CTR

If you are a publisher or a digital marketer and want to become successful in your career, it is really important to understand CPC, PPC, CPM or CTR. These pricing models are used in digital advertising. When you promote your site on the internet in Google Ads, Microsoft Ads, Facebook Ads, Amazon Ads or in any other advertising platform they ask you to set the PPC or CPM for ads to be served on the internet. So, let's see what these terms mean.

What is CPC or PPC?

CPC (cost-per-click) and PPC (pay-per-click) are the advertising models used in digital marketing or in internet marketing in which advertisers pay publishers only for clicks on the ads. In this pricing model, publishers are paid out for every single click on the ads. Cost Per Click (CPC) may vary publisher to publisher.

CPC formula

CPC formula
CPC Calculation Formula

What is CPM?

CPM stands for cost per mille also known as cost per thousand. It is another most important pricing model used in online advertising in which advertisers pay publishers for one thousand impressions or views on the ads. If you set a CPM of $0.8, and your ad got 25,000 views a publisher will be making a gross revenue of $20.

CPM formula

CPC formula
CPM Calculation Formula

What is CTR?

CTR or Click Through Rate is a ratio of number of click received by the ad to the number of times ad served to users. The average CTR in is 1.9%, and 0.35% for search and display ads respectively. Usually, native ads have higher click through rate because these ads are blended in the content of the website and seem like native content. The higher the CTR is the higher the revenue publishers would generate.

CTR formula

CPC formula
CTR Calculation Formula



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