# oCPC Product Manual-V1
# 1. What is oCPC?
oCPC is the abbreviation for Optimized Cost Per Click. It is a smart ad placement mode that aims to bring in more quality traffic through optimizing conversion cost. You will need to specify your target audience and an average conversion cost. The system will then utilize its conversion prediction model to predict the bid for each ad request in real time, and make subsequent smart bids. This will control conversion cost, and also bring in more quality traffic.
# 2. How does oCPC work?
- Bidding and billing, oCPC vs other bidding modes oCPC is a bidding mode option - like CPC, CPM, CPA, etc. Their differences are illustrated as follows:
| Bid Type | ECPM | Automatic bidding | Billing event | Billing amount |
| CPM | ecpm=cpm_price/1000 | - | cost per impression | Advertisers fill in on the platform |
| CPC | ecpm=ctr*cpc_price/1000 | - | cost per click | Advertisers fill in on the platform |
| oCPC | ecpm=ctr*cvr*cpa_price/1000 | ✓ | cost per click | According to the system's automatic bid, the actual conversion cost is ultimately equal to the advertiser's expected target cost |
| CPA | ecpm=ctr*cvr\*cpa_price/1000 | - | cost per conversion | Advertisers fill in on the platform |
Target conversion event: install. Estimated cost: 10 USD.
User 1 clicks on the ad. The system estimates a conversion chance of 50%, then factors in conversion rate and the market situation - 6 USD will be charged for this click.
User 2 clicks on the ad. The system estimates a conversion chance of 1%, then factors in conversion rate and the market situation - 0.08 USD will be charged for this click.
……
The result would be a cost of 1000 USD for 100 installs - which matches the expected conversion cost.
- User value is gauged based on data. It means there are three stages for oCPC: learning, learning success, and learning failure.
- Learning: this is when the system learns and experiments. This stage requires a minimum of 50 conversions to run, and costs may overrun during this stage.
- Learning success: the system has successfully completed its learning and experiments. It will now perform smart bids based on its conversion prediction model to improve conversion and control conversion cost.
- Learning failure: there were fewer than 50 conversions in seven days - the learning and experiments fail. We suggest that you terminate the ad group.
# 3. What are the advantages of oCPC?
oCPC gains traction quicker, and gains magnitude better when compared to CPA. It is also easier to operate and scale-up.
(1) Current features: optimize conversion cost, and at the same time gain more conversions. You may set install as your conversion target and bid using oCPC in MiAds. The system will utilize algorithms to gauge user value and bid accordingly - higher bids for quality traffic, and vice versa. It may thus improve conversion and yet keep conversion cost under control.
(2) Upcoming features: oCPC will be easier to up-scale and operate. Compared to CPC and CPA, oCPC is planned to be stackable with other bid modes (e.g. auto-optimization), so as to better adapt to different cost scenarios.
Auto-optimization: Maximize in-depth conversion optimization while keeping conversion cost under control. This is useful in scenarios where app conversion and specific in-app events are priorities.
Magnitude prioritization: the system will go for as many conversions as quickly as possible. The actual cost might be slightly higher than the target. This is useful in scenarios where the budget can bear cost fluctuations, or during events/sales where it is paramount to gain as many conversions as quickly as possible.
# 4. oCPC quality use cases
A financial app had aimed to improve install through ads on MiAds.
Target conversion event: install
Target conversion cost: 0.84 USD
Placement: Two identical (direction and media) ad groups, each using different bid modes. Results as follows:
| Ad Group | Install | Cost | Conversion cost | Day 2 Retention |
| oCPC | 774 | 664 | 0.86 | 2.90% |
| CPA | 717 | 600 | 0.84 | 2.53% |
| oCPC vs CPA | ↑8% | ↑11% | 2% | ↑15% |
# 5. How can I use oCPC?
- Get oCPC use permission from your account manager.
- Create oCPC ad group:
a. We suggest checking the "Use preferred placement" option.b. Bid module: Check "oCPC". You may only pick "Install" as the conversion target for now. For bid amount, fill-in your expected install cost.
- Evaluation: one-day performance will be heavily subjected to fluctuations, so we suggest that you evaluate performance 2-3 days after the learning stage. Metrics: impression, conversion, conversion cost.
a. Conversion measurement: events will be logged on the day when the conversion event (i.e. install) happened.b. Billing measurement: events will be logged on the day when the billing event (i.e. click) happened.
Ad A: 10 users clicked the ad on May 1, with 3 of them opening the app after clicking the ad; 5 users only first opened the app on May 3.
That would mean that on May 1, by conversion measurement there had been 3 conversions; while by billing measurement there had been 8 conversions.
As delayed conversions would usually take 2-3 days to be fully accounted for, we suggest that you wait 2-3 days before checking your billing measurement based conversions and conversion cost. In general, it is normal for actual conversion cost to lie between of 0.8x-1.3x of your estimated cost.
