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What is Cost per Acquisition?

Cost per acquisition (CPA) is a financial term used in marketing to measure how much is the total cost of acquiring one paying customer on a campaign. By tracking this, business owners can figure out the net cost of advertising.

Most marketers prefer this pricing model because it lets them set a goal of acquisition before paying for a marketing campaign. So, they only greenlight a project when that desired goal of purchase is met.

Some marketing mediums that use CPA are pay-per-click (PPC), affiliate, display, social media, and content marketing.

So, how do you calculate the cost per acquisition?

To calculate the CPA, you need to take the total amount you spend on advertising and divide it by the numbers of acquisitions (sale, click, or form submission) generated.

How can CPA be optimized?

Writing amazing copy and ads is the ultimate way of increasing the cost per acquisition. This is done by implementing a well-planned content marketing strategy. This should generate significant traffic and attract customers by sharing valuable and relevant content.

A website that provides value-added content will stand out and have users that are there to stay.

Create an offer that is interesting and clear. It is also helpful if you leave some things to the imagination of your readers. Let them be curious. Take into consideration your audience’s emotions instead. Know what drives them, what they love, and hate. Do your research and show how much you care about their problems and feelings.

Additionally, invest in UX website design. Let the layout be simple and easy to understand. Create compelling headlines and sub-headlines to grab your audience’s attention.

Finally, be more interested in conversion instead of clicks. Sometimes, clicking doesn’t mean staying. Pay attention to what your conversion rate is and work to improve your site accordingly.

How can I track CPA?

  –  Export data from your Google Ads PPC campaign.

  –  Use promotional codes and customized links for an internal campaign.

  –  Use UTM parameters to track your social- and affiliate-marketing-generated traffic.

  –  Include a field where your customers need to provide information on how they found about your business.