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What is cost-per-acquisition (CPA)?

Short answer

CPA, or cost per acquisition, is what you spend in ads to get one conversion, like a lead, booking or sale. It equals ad cost divided by conversions. For example, $1,000 that brings 20 leads is a $50 CPA. CPA is only as accurate as your conversion tracking, so set that up first.

In this answer
  1. 01CPA depends on what you count
  2. 02Tracking makes CPA real
  3. 03Target CPA bidding
  4. 04How to lower CPA

CPA depends on what you count

"Acquisition" means whatever you define as a conversion. The same campaign can show very different CPAs.

One campaign, three different CPAs (example)
  1. $50LeadsEvery call and form from the ads.
  2. $80Qualified leadsLeads that fit your service and area.
  3. $200CustomersLeads that became paying jobs.

These are example numbers. The point is to decide which CPA you manage to. Cost per customer tells the truth about profit.

Tracking makes CPA real

Google Ads counts conversions only if you set up conversion tracking. Calls, forms and bookings each need a conversion action. For cost per customer, report closed deals back to Google Ads, which its enhanced conversions for leads support.

Target CPA bidding

Google Ads offers a target CPA strategy. You tell it what you want to pay per conversion, and it sets bids to hit that average. It needs steady conversion data to work well. If you count low-quality form fills as conversions, it will chase more of them.

How to lower CPA

  • Cut keywords and areas that spend without converting.
  • Improve the landing page so more visitors act.
  • Answer calls faster, so more leads become customers.
  • Count only conversions that matter in bidding.

Good example. A law firm counts only qualified consultations as its main conversion. Its CPA looks higher but its cost per signed case falls.

Bad example. A firm counts every page view of the contact page as a conversion. CPA looks great, and cases do not come in.

Read what a good CPA is. Our PPC management reports cost per customer, not just cost per lead.

Keep reading

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