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Keyword Tool CPC does not match the real CPC

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# 1
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In the Keyword tool for US for broad keyword "yahoo email passwd" shows CPC(Search): 62 but I've real data average of 65 click cost coming to : 44. Why is it so?

 

At the same time I've another broad keyword: "hotmail forgot password", keyword tool shows CPC: 47

But I've one click CPC : 165 yesterday.

 

I've checked two other keywords but their CPC matched.

 

What conclusion can I draw?

 

 

 

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Accepted by Theresa_Zook (Top Contributor Alumni)
September 2015

Re: Keyword Tool CPC does not match the real CPC

[ Edited ]
Top Contributor
# 2
Top Contributor

Hi UtilitiesIndia,

 

The Keyword Tool is meant to give you a broad idea about relative CPC values, therefore it is applicable to the average advertisers. However, none of us can be an average advertiser in each and every aspect. The specifics of your campaign/ad group are not factored in the estimate CPC. Such specifics may include the quality of your ad copies, landing pages(s), or website and/or historical account-wide data associated with those items or the keyword proper, a unique choice of geo-targets etc. etc.

 

On top of that the actual advertising scenario is pretty much dynamic and changes from second to second. That is also a major element in the calculation of the actual CPC that you pay to Google for a click.

 

You seem to be mixing up actual CPC, i.e. the price of a click, with the daily number of clicks. Above I meant the former metric. No problem, however, since similar considerations apply to the daily number of clicks as well.

 

Best,

Lakatos

Re: Keyword Tool CPC does not match the real CPC

[ Edited ]
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# 3
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Thanks Lakatos!

 

Do you have any link which can give some insight into it?

I think landing page quality's affect will be nominal in CPC. 

 

How much % CPC cost can vary depending on historical CTR, given that all other parameters remain same?

 

I wish I could have some stats like standard deviation along with CPC in the keyword tool.

Also I've not mixed price of click with number of clicks.

Re: Keyword Tool CPC does not match the real CPC

Top Contributor
# 4
Top Contributor

Hi,

 

When answering your queries I have nothing else to rely on than Google's communications and my own experience. It can be appreciated that Google never discloses more publicly than what they think is enough for advertisers to manage their accounts. Specifically, though Google regularly discloses metrics that are factored in various calculations their weights in the calculations are never published.

 

Not to mention standard deviation: Google never goes as scientific as that in communications. I need to tell you just in case you come from a math background and wish to set up a sytem of equations so you can precisely forecast everything: that's a naive dream which will never come true. First because Google does not disclose the data or the probability functions, and second because the advertising landscape changes continuously.  - They of course heavily use probability functions, confidence intervals etc internally but all those items are highly confidential. Google also has competitors ... Robot LOL

 

Best,

Lakatos