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What are PPC, CPC and CPA?

If you’re just starting out in affiliate marketing, it’s important to know the lingo. Here we explain 3 of the fundamental terms that confuse beginners.

Acronyms and buzzwords can be daunting to anyone embarking on a new journey. Whether it’s marketing or mountain climbing, every new adventure comes with its own language. In this article, we’ll explain the meanings PPC, CPC and CPA so that you can start your journey into the exciting world of affiliate marketing.

PPC, CPC and CPA are some of the first terms you’ll see when starting out. They usually come right after the term ‘affiliate marketing’. So what do these letters stand for and what do they mean?

PPC- Pay Per Click

PPC is short for Pay Per Click and refers to a model of internet marketing where advertisers pay every time a visitor clicks on one of their ads. It allows companies to pay for people to visit their sites, instead of hoping for organic traffic.

SEA or Search Engine Advertising is the most popular form of PPC. Google, for example, enables advertisers to bid on ad placements in the search results. If you Google a keyword search that a company has successfully bid on, then you’ll see their sponsored result featured at the top of the list.

CPC- Cost Per Click

CPC or Cost Per Click is way of determining how much an advertiser to a publisher for every click on an ad. It refers to the same method as PPC, but is used to refer to the means of calculating cost, whereas PPC is used to describe the advertising method.

CPC plays a major role when choosing your bidding strategies and conversion bidding types, as it’s needed to maximize the number of clicks relative to the size of your budget and targeted keywords.

CPC can be calculated by dividing the cost off all of your clicks by the total number of clicks.

Cost/Clicks = CPC

If your ad gets 2 clicks, one costing $0.40 and the other $0.30, your total cost is $0.70. Divide $0.70 by 2 and your average CPC $0.35.

CPA - Cost Per Action/Cost Per Acquisition

CPA or Cost Per Action marketing is a business model that pays a commission to affiliates when specific actions are completed by their visitors.

The action/acquisition can be one of many, but the most common are signing up to services and buying products. Getting visitors to sign up is also known as CPL or Cost Per Lead, as advertisers will pay affiliates for generating potential future customers.

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