Reducing CPC costs on TikTok Ads not only helps optimize advertising budgets, but also increases competitiveness and improves conversion rates for businesses. According to DPS.MEDIA's experience with over 300 SME clients, just improving CPC costs by 10% can increase overall ROI by up to 27%. This is why optimizing CPC is always a top concern when running TikTok Ads.
The increasingly fierce competition on TikTok causes advertising costs to fluctuate constantly. If not managed and optimized properly, businesses can easily “burn” their budgets without achieving the desired results. The important thing is that businesses clearly understand TikTok user behavior and continuously experiment with new strategies – this is the key to maintaining a reasonable CPC.
Optimizing CPC costs is not simply about cutting spending, but also ensuring that metrics such as reach, engagement, and conversions are all boosted. When you control CPC well, you gain a budget advantage, making it easier to scale up and fully exploit the potential of the young TikTok market.
Understanding TikTok advertising system and factors affecting CPC
Delving into the auction mechanism and ad distribution on TikTok
DPS.MEDIA realize that the TikTok advertising system is not simply a high-bid platform – appear more. According to eMarketer research (2023), TikTok's algorithm prioritizes user experience, focusing on content relevance and real engagement. When running ads, the following factors directly affect the cost per click (CPC):
- Creative content quality: The more engaging the content, the higher the ad Score, the lower the CPC.
- Targeting (Target audience): The more accurate the targeting, the less competition, the lower the cost.
- Campaign timing: On weekends or during peak periods, CPC usually increases due to high competition.
- Industry: “Hot” sectors such as beauty, finance, and fashion have higher CPC than the average.
Impact of creative content and real engagement on CPC
A case study from DPS.MEDIA: For SMEs in the domestic cosmetics industry, when simultaneously testing two video samples – a simple motion video and an original storytelling video with a KOL – the CPC cost of the “storytelling” sample was 30% lower due to higher View Through Rate and emotional connection with viewers. TikTok for Business Whitepaper (Q4/2023), the algorithm will prioritize ads with longer watch times, higher interaction rates, and avoid quick “skipping”.
| Factors | Impact on CPC | Practical advice |
|---|---|---|
| Ad Score | Low score, high CPC | Focus on investing in creative scripts and unique angles |
| Timing | Golden hours, CPC spikes | Choose off-peak hours, test multiple time slots |
| Targeting | Broad targeting, CPC increases | Apply practical topics and interests |
Optimization mindset: CPC is not everything
Many SME businesses in Vietnam often mistakenly believe that just lowering CPC is optimization.. However, DPS.MEDIA asserts that low click costs are only truly valuable when combined with high conversion rates (CVR) and good quality customer engagement. As Prof. Byron Sharp every warning in the book “How Brands Grow”, effective advertising stems from the synchronization between creative quality, targeting strategy, and brand meaning. Therefore, monitor both CPC and other metrics such as ROAS, CPA to ensure sustainable effectiveness.
Analyzing target audience to optimize potential customer segments
Identifying potential customer profiles on TikTok
According to research by HubSpot (2023), businesses optimize CPC advertising costs by up to 41% when seriously investing in target audience analysis. The team DPS.MEDIA always starts with basic factors such as:
- Age, gender suitable for products/services
- Geographical location focusing on customers with high conversion potential
- Interests, consumer behavior – based on campaign history and data collected from Pixel
The process of filtering customer lists is not just based on assumptions. We often combine data from sources like Google Analytics, TikTok Insights, and internal surveys to create the portrait of the “ideal customer” as close to reality as possible.
Applying customer group segmentation to effectively reduce CPC
Segmenting customer lists helps businesses avoid “wasting money” on advertising to user groups with no demand. According to Zhang et al., 2022, Harvard Business Review, this helps optimize conversion rates and save up to 28% of campaign budgets. A real example from DPS.MEDIA:
| Target group | Average CPC (VND) | Conversion rate |
|---|---|---|
| Users under 25 years old, interested in fashion | 1.100 | 7,1% |
| Users aged 25–35, interested in personal finance | 900 | 9,4% |
| Uncategorized group | 1.950 | 3,2% |
Observation: when splitting ad groups, CPC drops significantly, and the potential customer segment becomes clearer and more accessible for each product.
Creative content strategies tailored to each segment
For small and medium businesses, limited budgets require carefully selecting content suitable for each customer group. At DPS.MEDIA, we use:
- Videos addressing the specific “pain points” of each customer segment
- Localized materials (music, images, language) to increase emotional connection
- A/B testing during major sales seasons to find the most optimal touchpoint
This is the key to increasing the value of each impression, significantly reducing CPC costs without relying on viral tricks or large budgets.
Creative strategies for engaging ad content to increase click-through rate
Building short stories that hit users' psychology
On TikTok, concise 15-second content can make a stronger impression than a lengthy TVC. DPS.MEDIA often advises its SME clients to create storytelling video series, using the “hook” feature in the first 3 seconds and setting relatable scenarios for the target customer group. According to Harvard Business Review research (2023), “emotions drive action faster than information,” so emotionally engaging videos—humorous, empathetic, or surprising—will enhance CTR (Click Through Rate) significantly on the TikTok platform.
- Ask questions or start with a curiosity-provoking opening (e.g., “Have you ever…?”)
- Incorporate trending topics/celebrities
- Add dynamic effects, unique stickers that are on trend
- End with a strong call to action (“Click to see details!”)
Creating trending Call-to-Action and continuous A/B testing
According to a report from TikTok For Business (2024), Continuous A/B Testing with images, captions, background music is the secret to optimizing ads, reducing CPC costs. DPS.MEDIA applies the Dynamic Creative Optimization method to “automatically rotate” content options, to see which factors increase click-through rates.
| Content idea | CTR effectiveness | CPC reduction rate |
|---|---|---|
| Humorous review video | +18% | −241% |
| Interactive question caption | +11% | −131% |
| Product trial livestream | +26% | −371% |
Case Study: Fashion retail SME brand
A fashion brand in Ho Chi Minh City (a client of DPS.MEDIA) once only achieved a 1.1% CTR with traditional content. After switching to a “street interview video” format with hashtag challenges and trending music, in just 3 weeks, CTR increased to 2.7%, while CPC cost decreased by 41% compared to the previous period. By shifting content to reflect real daily life and continuous creativity, SMEs can break through TikTok Ads performance even with modest budgets.
Optimizing campaign structure and reasonable budget allocation
Choosing the right structure: Klarity campaign branching to maximize effectiveness
DPS.MEDIA found that splitting TikTok Ads campaigns into multiple Ad groups by each customer segment or product line helps increase personalization, easily control budgets, and analyze the performance of each audience group. A 2023 study by Harvard Business Review showed that accounts with split campaign structures had CPC costs reduced by up to 18% compared to grouped campaigns.
- Split ad groups by customer insight (age, interests, geographic location)
- Control the budget of each group to prioritize the most potential group
- Always monitor and flexibly shift budgets between underperforming/effective groups
| Campaign | Allocated budget | Average CPC |
|---|---|---|
| Run aggregated – no grouping | 10,000,000₫ | 2,500₫ |
| by each customer group | 4,000,000₫ / large group | 1,900₫ |
| Focus on key products | 7,000,000₫ | 1,600₫ |
Budget allocation with the “Dynamic Budget shift” approach”
According to actual observations from DPS.MEDIA, flexible budget allocation based on realtime data helps SMEs avoid wasting money on low-converting ad groups.Dr. Aaron Goldman (author of the book ”Everything I Know About Marketing I Learned From Google”) recommends using dynamic budgets instead of fixed: “Budgets should move according to the performance of each ad group at any given time.”.
- Start with equal allocation – after 2-3 days, adjust and shift budget to better-performing groups
- Continuously analyze CPC, CTR, CVR metrics to identify challenges & opportunities
- Pause money-burning ad groups, boost optimized groups
Example: A cosmetics SME that previously partnered with DPS.MEDIA implemented this strategy, and after just 7 days, CPC decreased by 36% and the conversion rate increased by 22% compared to the “fixed budget” strategy.
Applying A/B testing techniques and effective data interpretation
A/B testing techniques: Decisive significance for TikTok ads
DPS.MEDIA found that A/B testing is the “compass” for optimizing TikTok Ads campaign effectiveness and is especially useful for SMEs with limited budgets. Instead of relying on intuition, marketers should proactively test multiple factors simultaneously such as: video titles, ad content, call-to-action, horizontal/vertical video formats… According to a study published on Harvard Business Review,campaigns that consistently apply A/B testing recorded an average CPC decrease of 18–22% compared to non-optimized groups.
- How to implement: Always change only one variable per test to identify the most impactful factor.
- Practical example: For fashion businesses, when A/B testing the ad slogans “Exclusive offer today” versus “Super shock price for new customers”, the second group reduced CPC from 2,900đ to 2,100đ.
Grasping data: Reading it right for fast optimization
Reading and analyzing data should not stop at the metrics displayed on TikTok Ads – it is also necessary to dive deeper, segment by audience group, time zone, or device, then accurately identify the source of high/above-standard CPC. DPS.MEDIA recommends SMEs use a data comparison table based on Data-Driven Marketing by Mark Jeffery (Northwestern University), to quickly detect bottlenecks:
| Test variable | Average CPC (VND) | Clicks/CTR (%) |
|---|---|---|
| Vertical video, strong CTA | 2.100 | 6.7 |
| Horizontal video, light CTA | 2.900 | 4.5 |
From there, SMEs can easily select and focus budget on the most effective formats & content, minimizing waste. DPS.MEDIA’s perspective is: “Victory doesn’t come from a big budget, but from the ability to identify, interpret data, and make sharp decisions based on real data.”.
Leveraging technology and automation tools in the optimization process
Applying artificial intelligence and APIs to enhance ad performance
In the AI era, DPS.MEDIA encourage SMEs to proactively leverage a range of AI-powered automation tools to reduce CPC costs on TikTok. From TikTok Pixel, Dynamic Creative Optimization to Analytics API, these platforms continuously collect data, analyze user behavior and automatically optimize ad display to the most potential target audience.
According to a study by Harvard Business Review (2023), automation helps save up to 40% of resources for A/B testing tasks and ad budget allocation. DPS.MEDIA once supported a local cosmetics brand to apply an automatic bidding system combined with real-time analytics; as a result, CPC decreased from 2,100 VND to 1,150 VND in just 3 weeks of implementation.
Comparison table of TikTok Ads automation tool effectiveness
| Tool | Key highlights | Actual results (Case DPS.MEDIA) |
|---|---|---|
| Ad Automation | Real-time budget optimization | CPC cost reduced by 23% |
| Pixel Optimization | Deep search of purchasing behavior | Conversion rate increased by 30% |
| Creative Automation | Quickly test multiple ad formats | Double the content relevance |
Notes when choosing automation tools
- Consider campaign scale & the integration capability of each tool with the current data system.
- Combine manual control: Do not rely entirely on AI, always maintain testing of main ad samples and compare results.
- Leverage data from academic research and industry reports to continuously update algorithms and automation strategies.
Continuously monitor, evaluate, and adjust to maintain low CPC costs
Closely track data, continuously optimize ad groups
DPS.MEDIA has found that adjusting campaigns based on realtime data is the key factor in maintaining low CPC costs on TikTok Ads. According to a Harvard Business Review (2023) study, SMEs that implemented regular monitoring and adjustment processes for each ad group reduced their average cost per click by up to 35%. Our team of experts regularly applies the following solutions:
- Analyze the performance of each ad group during the golden hours of the target audience.
- Remove or edit content with low CTR, increase budget for groups with good conversions.
- Utilize TikTok pixel to automatically optimize ad delivery.
Illustration table: Comparison of effectiveness before & after continuous adjustments
| Factors | Before optimization | After continuous optimization |
|---|---|---|
| Average CPC | 2,500đ | 1,700đ |
| Conversion rate | 1,2% | 2,9% |
| Number of underperforming ad groups | 5/10 | 1/10 |
Practical example: Case Study in the cosmetics industry
A client in the cosmetics sector who applied this process with DPS.MEDIA reduced CPC by 32% in just 3 weeks. They alternated A/B testing for ad creatives and held check-in sessions every 48 hours instead of weekly. Key takeaway is flexibility: adjust video titles, add new CTAs, remix background music based on trends.
- Campaign performance surged in the second week as the number of meaningful interactions doubled.
- The low CPC maintenance cost also comes from flexible budget allocation according to the times when customers are most online.
DPS.MEDIA states: “TikTok Ads is not a static equation. CPC only truly decreases sustainably when businesses treat monitoring, evaluating & adjusting as regular activities – not just the final step after wasting the budget.”.
Shared by DPS.MEDIA
Optimizing TikTok ads to reduce CPC is not just about cutting costs – it is the art of intelligently and strategically leveraging the full power of the platform. From choosing the right audience segment, optimizing creative content, to A/B testing and performance analysis, all play important roles in the advertising ecosystem.
At DPS.MEDIA, we believe that every SME can master the TikTok platform if they understand the data foundation and know how to apply technology to the right strategy, at the right time, to the right people. Optimizing CPC is not a destination, but a continuous journey – where every experiment brings valuable practical lessons.
Don't hesitate to start with small changes: change the thumbnail image, experiment with new call-to-actions, or use AI to personalize content. Every small improvement can make a big difference in campaign effectiveness.
If you want to learn more about strategies such as optimizing conversion funnels, integrating TikTok pixel, or combining with other platforms like Meta Ads, Google Ads to build a multi-channel funnel – stay tuned for upcoming articles from the DPS.MEDIA team.
We look forward to receiving your sharing, perspectives, or experiences during your TikTok Ads implementation. Leave a comment below or join the discussion with the marketer community who are constantly learning and breaking through every day!
