ICC and ECPC
Re: ICC and ECPC
Let's say your current bid is $1 and you are getting a 100 number of clicks, then the total cost is $100. You decided to increase your bid to 2, you got 250 clicks, now the total cost is $500.
Incremental clicks:- are the difference between the number of clicks before and after increasing bids 250-100=100 clicks.
Incremental cost:- is the difference between your costs before and after increasing bids 500-100= $400
Incremental cost per click:- is the result of dividing the incremental cost on incremental clicks 400/100=$4
When your value per click is higher than your incremental cost per click it makes sense to increase your bid. On the other hand, if your value per click is lower than your incremental cost per click, you probably want to decrease your bid.
Watch this video for more info:- https://www.youtube.com/watch?x-yt-cl=84503534&v=jRx7AMb6rZ0&x-yt-ts=1421914688
Enhanced cost-per-click:- is a bidding feature that raises your bid for clicks that seem more likely to lead to a sale or conversion on your website. That helps you get more value from your ad budget.
Read More:- https://support.google.com/adwords/answer/2464964?hl=en
Re: ICC and ECPC[ Edited ]
January 2015 - last edited January 2015
Understanding Incremental cost per click (ICC):
The Bid Simulator will generate various bid amounts below your value per click figure. The simulator will also let you see estimated number of clicks and the total cost of those clicks for each of the various bid levels. In order for you to determine which bid level will maximize your profit, you will need to calculate the incremental cost per click (ICC) for each of the bid amounts.
To determine the ICC, use your simulator chart to select a bid you wish to calculate the ICC for, along with the bid next lowest to it. So, if you are calculating the ICC for $5.00, you will need to use the bid data for $4.50. Using the simulator chart, find the following:
Difference between clicks= Incremental clicks
Difference between cost= Incremental cost
Then, plug these values into the following formula:
Incremental cost per click (ICC)= Cost of incremental clicks / Number of incremental clicks
Velue per click (VPC) < Incremental cost per click (ICC) → lower your bid
Velue per click (VPC) > Incremental cost per click (ICC) → increase your bid
The ICC generated means that for each additional click from your lower bid to your higher bid amount will cost you $5.78. You should then repeat this process for the rest of the bid amounts generated by your bid simulator to see what the ICC for each bid is. The ICC closest, but not over, your value per click figure is the most profitable bid amount. If your ICC is say, $4.60, you may want to bump up your bid amount slightly to get as close to $5.00 as possible, thus further maximizing your profit.
Velue per click (VPC) = Incremental cost per click (ICC)
To sum up this Google AdWords help lesson: by calculating your value per click and your ICC, you can be sure you’re getting at, or near your maximum profit amount.
Understanding Enhanced cost-per-click (ECPC):
This is a bidding feature that increase more and more your bid to clicks, lead, sale or conversion on your website and helps you get more value from your ad budget. Suppose your website for sell T-shirt, and you set your bid by maximum CPC for US$2 with ECPC turned on. If the AdWords system sees an auction that looks likely to lead someone to buy T-shirt on your site, it might trigger your bid as high as US$2.30 for that auction (that is, your US$2 max CPC bid plus 30 percent more). It's called Enhanced cost-per-click (ECPC).
Re: ICC and ECPC
I am jumping into the conversation, You provided a very useful Information but I would like make a small correction in the calculation made in your given example
Incremental clicks calculated i.e. 250-100=100 clicks. is incorrect
Here correct Incremental clicks is 250-100=150 clicks
Incremental cost is 500-100= $400
Hence, Incremental cost per click is 400/150=$3.33