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Google AdWords is an auction-based advertising system: depending on your advertising goal, you can choose cost-per-click (CPC), cost-per-thousand-impression (CPM), or cost-per-acquisition (CPA) bidding.
CPC: Cost-per-click (CPC) With CPC bidding, you tell us how much you're willing to pay per click, and we use that price in our auction pricing system. CPC is a great choice if your goal is to drive traffic to your site with your ads.
CPM: With cost-per-thousand-impression (CPM) bidding, you bid based on the amount you want to pay for impressions, or views, of your ad. CPM bidding works best when you want to focus on branding - when it's important that your message is seen by as many of your target user group as possible, and generating traffic is not your primary goal.
CPA: With the Conversion Optimizer tool, you bid using a maximum cost-per-acquisition (CPA), which is the most you're willing to pay for a customer performing a specified action on your website (such as a purchase or signup). Using historical information about your campaign, the Conversion Optimizer automatically finds the optimal cost-per-click (CPC) bid for your ad each time it's eligible to appear. You still pay per click, but you no longer need to adjust your bids manually to reach your CPA goals and can benefit from improved ROI. Learn More.
Content bidding: If you find that your campaign performance on the content network differs from your campaign performance on search, you can set a separate bid for the content network.
"The Google content network was simply the most efficient channel for increasing clicks and conversions on the LavaLife site." Read more.
You always have full control over how much you'd like to spend on a daily or monthly basis, and you can change your budget and bids at any time. Additionally, a feature of our auction system called the AdWords Discounter will automatically ensure that you pay the lowest price possible to keep your ad's position on the page. Learn More.
If our data shows that clicks from a particular web page are less likely to convert into a customer for you, we'll automatically reduce the price you pay for clicks from that page. In fact, we've found that in many cases smart pricing enables our advertisers to achieve a lower cost-per-conversion on content as compared to search. Learn more about smart pricing.
If you sell tennis rackets, our system may determine that a click on a site about the U.S. Open Tennis Championship is worth less than a site about tennis racket reviews, so you'd pay less on the site about the Tennis Championship.