How does Ad Rank affect cost per click (CPC)?

our actual cost-per-click (actual CPC) is the final amount you’re charged for a click. You’re often charged less – sometimes much less – than your maximum cost-per-click (max. CPC) bid, which is the most you’ll typically be charged for a click.

Actual CPC is often less than max. CPC because with the Google Ads auction, you only pay what’s minimally required to clear the Ad Rank thresholds and beat the Ad Rank of the competitor immediately below you. And if there are no competitors immediately below you (for example, if no competitors other than you have cleared their Ad Rank thresholds), you only pay the reserve price. (See [Ad Rank thresholds to learn more.) Keep in mind that your actual CPC may exceed your max. CPC if, for example, you’ve enabled [Enhanced CPC