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What is Cost Per Acquisition ( "CPA")? [DEFINITION]

Written by Nick Simard on 10.11.17

"CPA" is short for Cost per Acquisition. Also known as pay per action ("PPA"), it is the estimated cost of obtaining a new customer. This is one of the most important measurements to consider for your advertisements. It’s an online advertising pricing model where the advertiser pays for each specific action. To generate customers, marketers usually implement different campaigns, whether it be through social media, websites, blog posts, email, sales, or form submissions, including contact requests, newsletter sign ups, registrations, and more.

However, reaching out to contacts through these campaigns costs money. So, CPA is an estimate of how much the company should spend on a campaign, and how much money the company will get back from customers. To track CPA, advertisers must be active in tracking codes, building custom links, closing holes in sales processes, using unique promotional codes, and asking where new customers are coming from. A digital marketing agency can help you navigate through your paid campaigns and pricing models.


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Topics: Definitions