An average, not a ceiling
This is the distinction that catches people. Google's own wording is that some clicks may cost more than your target and some less, but altogether it will try to keep your cost per click equal to the Target CPC you set. If you need a hard ceiling on any single click, tCPC is not it. It adjusts bids using signals like device, browser, location, time of day and remarketing list membership.
Where it shows up, and why it matters now
tCPC can be set at campaign or ad group level, and an ad group setting overrides the campaign. It has become more relevant because it is Google's named replacement for Manual CPC in Demand Gen: Display campaigns migrating into Demand Gen lose Manual CPC, and tCPC is the equivalent Google points you at. We cover what else does not survive that move in the Demand Gen migration write-up.
It optimizes for clicks, not conversions
Worth being precise: Google describes tCPC as an automated bid strategy, not as Smart Bidding, which is the family that bids at auction time toward conversions or conversion value. Automated is not the same as conversion-optimized. If your goal is pipeline rather than traffic, tCPC is a traffic tool and Target CPA or Maximize conversions is the right instrument.
Common questions
Is Target CPC a cap on what I pay per click?
No. It is an average. Individual clicks can cost more or less than the target, and Google Ads aims to hold the average at the number you set rather than refusing clicks above it.
What is the difference between Target CPC and Manual CPC?
Manual CPC sets a maximum you will pay and does not adjust. Target CPC lets Google set bids automatically using auction signals while steering the average toward your target. tCPC is Google's named replacement for Manual CPC in Demand Gen.
Is Target CPC Smart Bidding?
Google describes it as an automated bid strategy rather than Smart Bidding. Smart Bidding refers to the strategies that use auction-time bidding to optimize for conversions or conversion value: Target CPA, Target ROAS, Maximize conversions and Maximize conversion value.