Cost-per-acquisition (CPA)

Cost-per-Acquisition (CPA), also known as cost per acquisition, is a metric in Search Engine Advertising (SEA) that allows you to measure the average costs incurred to acquire a new customer or conversion. It indicates how much you need to spend on average to achieve a specific action, such as a purchase, a registration, or a download.

How is CPA calculated?

CPA is calculated by dividing the total costs of an SEA campaign by the number of conversions achieved. The result is the average cost per conversion.

For example, if you spent €500 on a campaign and achieved 10 conversions, your CPA is €50.

Use of CPA in SEA

CPA is an important metric in SEA because it allows you to measure and optimize the efficiency of your ad campaigns. By monitoring and reducing your CPA, you can improve the cost-effectiveness of your campaigns and achieve a better return on your advertising investments.

CPA is often used in combination with other key metrics, such as clicks, conversion rate, and average order value, to get a holistic view of your SEA campaign performance.

Why is CPA important for SEA?

CPA is important because it provides insight into the costs you need to incur to achieve a desired action. By optimizing the CPA, you can use your budget more effectively and increase the profitability of your SEA activities.

A lower CPA means you can acquire new customers or conversions more efficiently at lower costs, leading to a higher ROI. It also allows you to manage and allocate your marketing budget based on the performance of your campaigns.

By continuously monitoring, testing, and optimizing your CPA, you can refine your SEA strategy and achieve a better return on investment.

Cost-per-acquisition (CPA)