For advertisers, being aware of TikTok CPC (Cost Per Click) is crucial to their success. As an essential metric within the TikTok ecosystem, understanding its significance, calculation, and benchmark is crucial for brands aiming to optimize their advertising efforts.
In this article, we’ll provide you with valuable insights and practical tips to help you achieve lower CPC on TikTok. Get ready to unlock the potential of cost-effective advertising and take your brand’s TikTok presence to new heights. Let’s dive in!
Table of Contents
What is TikTok CPC?
CPM, which stands for Cost Per Mille (or Cost Per Thousand), refers to the cost advertisers pay for every 1,000 impressions of their ad. It represents the expense incurred by the advertiser for reaching a thousand users with their ad, regardless of whether the users interact with the ad or not.
How to calculate your TikTok CPC?
To calculate your CPM, follow this formula:
Let’s imagine if you spend $500 in your ad campaign, and gain a total of 500 clicks on your landing page. Your CPM will be 500/500 = $1. What this means is that you have to pay $1 per click.
What does CPC mean for your businesses?
CPC is a metric with 2 purposes: Bidding cost & Performance analysis.
Bidding cost to run ads
If you use the following campaign objectives for your ad, TikTok will use clicks as your campaign optimization goal, and CPC will be a way for them to charge the ads you have launched.
- Shop Purchases
- Product Sales
- Traffic
- App Installs
- Conversion
- Community Interaction (Profile Visits)
During the campaign setting process, you can choose to either set your daily budget or skip it; however, we would recommend small businesses fill in your budget. So, keep in mind the budget benchmark that TikTok has required:
- Campaign Level Minimum Budget: For both daily and total budgets, the minimum requirement is $50
- Ad Group Level Minimum Budget: Daily budgets for ad groups must exceed $20.
Unlike TikTok CPM, TikTok won’t give you a suggested CPC. Instead, they will offer you 2 options, either the lowest cost bid or cost cap. For small businesses with tight budgets, we suggest you choose the lowest cost bid so that TikTok can optimize your results with your resources.
Assess the cost-effectiveness of the campaign
Similar to CPM, analyzing your CPC can help you assess the cost-effectiveness of your campaigns. To be more specific, it can allow advertisers to determine whether the cost they are paying per click is reasonable in comparison to the value they are receiving from those clicks.
As a result, you will be able to optimize budget allocation and ensure that resources are invested in the most productive avenues.
A low CPC means that advertisers are paying a relatively small amount for each click they receive on their ads. In other words, it indicates that the cost of acquiring a click or visit to their website or landing page is lower, which can be more cost-effective for their advertising budget.
On the other hand, a high CPC means that advertisers are paying a higher amount for each click on their ads. This suggests that acquiring a click or visit through their advertising campaign is more expensive. When the CPC is higher than average, advertisers should analyze whether this result comes from higher competition for the targeted audience, more valuable keyword, or other factors.
What is the average TikTok CPC?
The average cost per click (CPC) for TikTok Ads is approximately $1, as reported by various sources.
However, it’s important to note that the actual CPC can vary based on factors such as the target audience, geographical location, and specific ad campaigns. For instance, JungleTopp reports a lower CPC of $0.19, and there are examples of other companies achieving even more cost-effective CPC rates.
These instances highlight how TikTok ads can offer affordability, making them an attractive advertising option for businesses operating across diverse industries.
How to lower your TikTok CPC
It is a known fact for all advertisers that the CPC can fluctuate rapidly due to various factors. Even though we can’t know for sure which algorithm TikTok uses to decipher our CPC, we can learn from some helpful tips to keep the metric as low as possible.
Audience targeting gone right
If the audience is false from the start and their needs don’t match what you target, it is unlikely they will click on your landing page. That’s why you should narrow down your target audience to reach users who are most likely to engage with your ad. TikTok’s targeting options, such as demographics, interests, and behaviors, can be utilized to refine your audience selection. You can improve your ad performance and potentially lower your CPC with a more relevant audience.
Have a good hook
The video content hook is the most important part of the ad creative. According to TikTok, their studies indicate that over 63% of all videos with the highest click-through rate (CTR) highlight their key message or product within the first 3 seconds (TikTok).
If you manage to attract their attention with a powerful hook, chances are they will keep watching and eventually click on your links to do the desired action, hence lower down your CPC
Have a good story
After getting their attention with a good hook, having a good story to introduce your product is also of paramount importance. A good story should help the audience understand what’s the appeal of your product, and also how it is going to solve the problems that they are having.
To pull this off successfully, it’s crucial that you select a content pillar that aligns with your product and target audience to maintain their interest. We would recommend small businesses to try out UGC TikTok ads to create a native feel for your brand and also can create social proof that will gain audience trust to click on your website.
Additionally, you should also make use of the interactive formats that TikTok offers, such as polls, replying to comments, stitches, and duets so that the user will have a more immersive and entertaining experience while watching your ad.
Have a convincing CTA
When creating TikTok videos, it is crucial to incorporate a clear and captivating call-to-action (CTA) that grabs viewers’ attention and motivates them to take action. If the CTA is vague or unclear, potential customers may not know what to do next and could exit your marketing funnel without engaging further or making a purchase.
To effectively engage your TikTok audience, craft a strong CTA that explicitly communicates the desired action, such as “Shop Now,” “Get Yours Today,” or “Swipe Up for Exclusive Deals.” Viewers will be more likely to click and explore your products or services as long as you are being explicit, exciting, and providing clear instructions.
Is it worth it to run TikTok Ads?
We hope the article has given you a clearer understanding of TikTok CPC and how you can optimize this metric. However, CPC is only a small part of the equation. In reality, running effective ad campaigns requires expertise and experience, making it a daunting task for beginners. However, with the right guidance and resources, beginners can gain the necessary skills and confidence to run successful ads and achieve their marketing goals.
Lucky for you, we’ve got just the thing you need: A complete guide on how to run TikTok ads in 2023. It’s packed with valuable insights, tips, and tricks to navigate the dynamic TikTok advertising landscape with confidence and expertise. Get ready to unlock the secrets of successful TikTok advertising and propel your brand to new heights in the exciting world of TikTok ads.
