Shocking, right? Advertisers most of the time pay LESS than their maximum bid per click. The Actual Cost Per Click (CPC) is the final amount charged for a click. There are a few factors that affect the Actual CPC:
- Clear the Ad Rank thresholdsÂ
- Beat the Ad Rank of the competitor immediately below youÂ
- Hold your ad positionÂ
- Show any ad formats shown with your ad, such as sitelink
A bid is the most an advertiser is willing to pay for a click on an ad for a particular search term or on a particular site. 90% of the time, an advertiser will NOT wind up paying what they bid for a particular term – rather, they will pay LESS than their bid. An advertiser can never be charged a cost per click that is more than their max bid.
The above is true for most major networks. The Google Search Network, Google Display Network, Yahoo Display Network, MSN (Bing) Search Network, AOL, and Facebook all operate under this principle.
