All variations of PPC can be divided into two ways of paying for the running of the ads: flat rate and bid based PPC. In the flat rate a fixed amount is required to run the ads but in Bid based model you are requre to be involved in a private auction where you are bidding for the best possible place for lowest amount possible depending of various things like weight of the keywords, location, what day and time it is etc. The highest bidder is ranked highest as in the image above.
Pay per click (PPC) or Cost per click (CPC).
This is a pricing model which is changeable every time a user clicks on ad. Cost per click is not measured as a constant, it is measured as an exposure of the ad. It helps control the budget and specific targeting but the downside is if someone is bidding for the same keyword or keyword phrase and it is less predictable because you don’t know how much traffic it will get.
On the image you can see CPC in action and that is what Google Ads are most famous for. You can see CPC Google Ads in search results or at the top of your emails if you are using Gmail. Google only charges advertisers if user clicks on the ad.
Cost Per Mile (CPM) or cost per impression or cost per thousand.
This is pricing model which charges a flat rate for 1000 times of displayed ad or “fire and forget”. So, it is a flat rate of times the ad was shown. This is mostly used for branding purposes or branding campaigns. The good side is you can clearly measure how much you get per click and you can know exactly how many times the ad is shown. The downside is: your ad can be shown to the same user multiple times.
Cost Per Action (CPA), cost per acquisition, cost per impression and cost per lead.
This is pricing model most used in affiliate marketing. CPA is such model where the payments are only made when users are performing some action like click on ad or an even better explanation: the only model that drives the action. Often, this type of advertising is converted to process where users go deeper than just clicking on ad, so it turns out the user made some other engagement and converted itself to a lead. Usually this model costs more than all other PPC models, requires involvement of data protection procedures and is usually avoided due to high cost.