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CPA calculator
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The CPA calculator simplifies the process of determining your cost per acquisition. To use the calculator, you just need to enter the total cost of your ad campaign, as well as the number of acquisitions that the ad spend has generated.
When you understand your CPA, you can use that information to evaluate your product margins and make improvements to increase your profits and boost your business’s finances.
This calculator helps you quickly determine your CPA across different campaigns, offers, and businesses.
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Frequently asked questions
Cost per acquisition (or cost per action) is the cost of acquiring a new customer. This metric refers to the cost of marketing and advertising campaigns that funnel leads to the point of conversion.
CPA is often used to measure the cost of an ad that prompted a sale, but it is also used to measure the cost of the marketing efforts that contributed to a lead completing a form, like an email newsletter subscription form.
The free CPA calculator divides your total ad cost by the number of acquisitions. This CPA formula gives you the average cost of acquiring a new customer or of acquiring a new form signup.
Businesses use CPA calculations in multiple ways. An ecommerce business might calculate the amount that they pay for social media marketing, like Facebook ads, to prompt a new customer to buy a product. A subscription box might monitor the cost of their digital marketing campaign’s Google Ads that lead a new customer to sign up for a trial box.
Some companies also use a CPA calculator to determine how much they spend on paid marketing channels for every lead that completes an online form to get a coupon code, sign up for an e-newsletter, get a personalized quote, or take advantage of another type of offer.
There is no single “good” CPA rate. It’s important to understand that CPA rates vary across different industries, and they can also vary between different advertising platforms, like social media or Google Ads.
What’s more important is to monitor your CPA rate across time and consider the value that your business is getting from your marketing campaigns. A low CPA rate is ideal, but that low rate really only has value if your customer’s lifetime value is high. For example, let’s say that your CPA rate is $10 per customer. If most customers make an initial $20 purchase but never make a second purchase, your business is making just $10 off of each customer that it gains.
But if your CPA rate is $10 per customer but your customers make an initial $20 purchase and then buy an additional $200 worth of products over their lifetime with your company, your CPA rate is much more valuable. The CPA rate is $10 in both scenarios, but the business in the second scenario will be much more profitable than the first business
The CPA rate offers more precision than a CPM rate, which is the “cost per mille” (or cost per thousand). The CPM rate identifies the cost for every 1,000 views that an ad receives. In contrast, the CPA rate measures the actions that result from your ads. Think of CPM as the cost of getting your message in front of 1,000 viewers, while the CPA rate is the cost of getting a single patron to convert to an actual customer.
A CPA calculator simplifies and speeds up the process of monitoring your CPA. When you regularly track your CPA, you’ll have data to evaluate your marketing and advertising efforts. You can use this information to identify which strategies are working, as well as which are less effective. Then, you can use this data for optimization, maximizing the effectiveness of your marketing spend. When you’re able to lower your CPA but still convert those repeat, high-paying customers, you can increase your profits and strengthen your business.