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Definition: It is an important metric in marketing that measures the total cost to acquire a customer in campaigns or a specific channel.


Developing marketing strategies to acquire customers and get high conversion rates can be a very challenging process.

If you don’t acquire the right customer, then there’s probably something wrong with your ads.

The cost per acquisition is calculated by dividing the total amount spent to acquire a customer by the total number of customers acquired.

CPA = total amount spent / number of customers 

CPA is only considered ‘good’ if it was able to meet the company’s marketing goals since it can depend on the products or services that they offer.

Why is cost per acquisition important?

In digital marketing, it’s a lot easier to reach an audience than converting them into buying customers.

Determining the cost per acquisition allows marketers to measure the impact of their marketing campaigns.

This metric is also used to track conversions on your website whenever a visitor fills a form, joins your newsletter, and more.

Where is CPA used?

What makes this metric good is that it can be used in different forms of advertising platforms.

Cost per acquisition can be used in Pay Per Click (PPC), Display Advertising, Affiliate Marketing,  Influencer Marketing, and Social Media Marketing (SMM) campaigns.

Pay Per Click

PPC is a type of online advertising in which a certain fee is paid by an advertiser whenever a user clicks on their ads and is taken to their website or landing page.

Display Advertising

This is a type of online advertising where banner ads are placed on websites to attract customers and generate conversions at a lower cost.

Affiliate Marketing

Affiliate marketing is when a person becomes an affiliate of a brand or company to promote their products or services to their website visitors.

Influencer Marketing

Influencer marketing is a little similar to affiliate marketing except that it’s more focused on doing promotions and taking advantage of their influence in most social media accounts.

Social Media Marketing

SMM is a  type of internet marketing that involves creating content for social media networks to promote brand awareness and achieve marketing goals.

Good Marketing Strategies to Lower CPA

Improving conversions while having lower CPA is every marketer’s dream.

There’s no secret formula in running effective marketing campaigns unless you’re persistent enough to make improvements on the way.

And since it’s a paid campaign, then you need to be extra careful to get the most out of your ads.

So if you’re still spending too much money and not reaching your business goals, then it’s about time you try these good marketing strategies to get the right customers.

Optimize landing pages

The performance of your landing pages can affect conversion rates and paying attention to your marketing analytics tool can help you understand user behavior.

Using an analytics tool like Google Analytics provides accurate data as it records all the activities in your landing pages.

Then, you can perform split testing or A/B testing to easily identify which one is better than the other.

Audience Targeting

Targeting the right audience is an excellent strategy to lower CPA and increase the chances of generating high conversion rates.

The reason why this works well is that you’re only running campaigns in a specific area to reach a specific audience.

So if you’re trying to sell a product, like maternity dresses, for example, market your products in an environment where your target prospect is congregating: Mom Blogs or Parenting Groups.

Create sales funnels

The stages in sales funnels make a huge impact on your website as it functions to guide prospects throughout the entire sales process.

When you use this strategy, you can expect to get the results that you always wanted.

Sales funnels are composed of different sales pages with different purposes.

However, building a sales funnel may take time but it can give you a clearer view of all the stages  in your funnel pages and convert potential customers easier.

Improve site speed

Improving your website’s site speed can help with search engine ranking and give visitors a good experience at the same time.

Most of the time, the reason why visitors abandon a web page is that it takes too long to load.

Speed up the checkout process

If takes too much time to complete a transaction on your eCommerce website, then don’t expect to get a good amount of conversions.

Prospects hate it when the sales process is very long or if the checkout form is asking for too much unnecessary information.

Another thing to note is to make your website user-friendly on mobile since most people are using their phones to shop online.

Reducing CPA is very important since it also indicates the ROI of paid campaigns.

If you have a lower CPA and getting higher returns, this is already considered a win-win situation for the business and the marketer.

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