Cost per Action (CPA)
The Cost per Action (CPA) metric is the total money spent on driving conversions. These conversions may include subscription or whitepaper download. The formula in calculating the Cost per Action is Payments for conversions/ Total number of conversion.
The Cost per Action (CPA) is an online advertising technique that enables an advertiser to pay on specified action from a prospective client. With the help of the CPA campaign, the advertiser can have low risk since the payment will only take place if a particular action happens.
How Cost Per Action Is Used
The CPA is also often associated with affiliate marketing. The Cost per Action is also known as Cost per Acquisition (CPA). In the CPA model, the publisher can have maximum risk since the income is based on the good conversion rates. With this, selling based on CPA is not as good as selling ads on CPM or cost per impression.
The relevance of the advertising inventory purchased by the advertiser can be calculated with the effective cost per action or eCPA. The eCPA can determine the total amount the advertiser should pay if it purchases the inventory on a cost per action basis. If you want to increase CPA, you must produce more engaging marketing techniques to gain more customers.