CPC: The Biggest Scam In “Retail” Media Buying And The Way It Messes Your Numbers Up


For those of my readers who are new to this, CPC in media buying stands for Cost Per Click.

It’s when they tell you “hey you have nothing to worry about – you’re only going to pay when a visitor clicks your ad!”

Yeah, right. Well here’s the thing about that:

Let’s say you or your agency is a retail advertiser, and Google or Facebook has inventory that they are going to sell you. You set up your ad, you set up your targeting, you choose your options and you say “Charge me for every click (CPC)” and you trust that whoever sells you those clicks are actually going to deliver, and charge you based on actual clicks.

Here are the 2 biggest problems with that:

#1 As every single media buyer with any experience of professional tracking will tell you: the number of clicks on the traffic source is always at least 5-10% higher than what came through to your website. That could be natural if your site is slow to respond. Some visitors just leave that fast. But it’s certainly a sketchy model in the first place – you just can’t check if those were actual visitors or just robots or maybe the traffic source just decided to overcharge you.

#2 Let’s say the inventory your ad is running on costs $5 / CPM (CPM = cost per one thousand impressions). Your ad runs and gets 10 thousand impressions, but just one click for every 1000. Now you really think you’re going to pay any less than $5 / CPM just because you opted for “CPC”?

Of course, the answer is no. You’re going to get a $5 “CPC” which is calculated based on the CPM.

And the problem with that is not just the fact that you believe you’re just being charged for clicks, because technically you are.

The real problem with that is that it messes up the way you interpret the results of your campaign!

Because let’s say you go out there and you write an ad and do CPC. You get the aforementioned $5 CPC and figure “oh well, this is not going to work”.

Well, you’ll notice that most traffic sources have some version of what they call a “quality score”. They will calculate this score based on your CTR (Click Through Rate) and some other data.

Based on this, you’ll get charged based on your CTR and the CPM of the inventory you have chosen.

OK, but now based on these stats, if it didn’t work, who can tell me what really broke the campaign at the end of the day?

Was it your CTR? Was it the ad copy? Was it the targeting? The angle? The placements?

With so many moving parts, what was it?

When and how will you come to the conclusion that the campaign has not worked? How will you know that you’ve done everything right?

This is why professional, wholesale media buying systems and websites only sell you CPM inventory.

With these systems, you know that for that specific market you have $5 to spend on every one thousand impressions.

You know that once you buy those one thousand impressions, you will be charged $5 no matter how many clicks you get.

And now it’s really up to you, and your ad to make the user click… and it’s up to you and your sales funnel to convert that visitor.

You can go generic, get more clicks, and do more preselling. You can go specific, get less clicks and go with a more targeted offer.

But at least you don’t forget how the process works. And you learn to manage your campaigns and your sales funnels properly.

All in all, it’s just a much more transparent way of advertising. It’s much easier to identify where the weak spots of your campaign are. Your CTR (Click Through Rate) might be too low (although a low CTR isn’t always necessarily a bad thing). Your targeting, your placements or maybe your sales angle might need more work.

But at the end of the day, you know exactly how much you’re paying, and you are really in charge.

Welcome to the world of performance marketing.

If you’d like to run a media buying test on some wholesale traffic platforms that retail advertisers don’t have access to, please schedule a conversation with me by clicking this link.

You can also grab some free mind maps and flow charts on campaign management and marketing strategy!

Or, if you’d like to learn more about JVBroker.com Academy’s Professional Media Buying Campaign Manager Mentoring Program or our other programs, please click here to learn more.

ABOUT BEN RACZ

As an established expert in many genres of online direct response marketing, Ben has worked as a strategic consultant, copy chief, PPC campaign manager and Product Launch Manager for some high profile direct response clients in 21 different countries.

Having worked on campaigns with New York Times bestselling author Robert G. Allen, success expert Brian Tracy, and Chicken Soup of the Soul creator Jack Canfield, Ben personally wrote Standard Operating Procedures on campaign management and media buying based on $500 million worth of advertising spend.

He became a marketer after managing a private intelligence firm for over a decade and being Director of Security at LogMeIn, Inc. in his previous career. Ben’s strengths are lead generation, PPC consulting, marketing audits, sales funnels, strategic planning, product launch management and deal-making.