For e-commerce sites, there is a product cost and Denmark Phone Number List a business cost for every sale. For lead generation sites, there may be only one set of up-front costs, and the cost of returning customers is relatively low.Assuming you generate £10 worth of profit per conversion, each customer buys an average of four items in their lifetime, and you Denmark Phone Number List 10 conversions per 500 unique visitors, this gives: Conversion rate Profit per conversion Simply multiply the profit per conversion by the conversion rate to get the breakeven cost per click.
This is the exact amount you can pay for each Denmark Phone Number List to your website and get the same return on average: Breakeven Breakeven CPC = Average Conversion Rate x Average Profit Per Conversion Step 5 – Adjust Profitability and Actual CPC Amount The Max CPC amount must be set below the breakeven CPC amount in Denmark Phone Number List order to profit from each sale after accounting for advertising costs. If the Max CPC is set higher than the Break-Even CPC, this will result in a lot of conversions, but overall, the cost of ad revenue per conversion is higher than the Denmark Phone Number List it generates, thus resulting in an overall loss.
Lowering your maximum CPC too much Denmark Phone Number List in a higher return on investment (ROI), but lowers the overall number of sales. This is because Google shows ads with higher Ad Rank in the results, and higher ads get more clicks on average. Denmark Phone Number List actual CPC amount tends to be slightly lower than the set maximum CPC amount because the actual CPC is based on the Ad Rank of the advertiser below the ad. In our experience, this is about a 20% reduction. For example, if you set a maximum CPC value of $1.00, you might spend an average of about $0.80 per click, a decrease of about 20%.