FormulaCPA = ad spend / number of conversions

Cost per acquisition (CPA) is the average ad cost of one conversion. For most online stores the conversion is a purchase, so CPA is often called cost per purchase. Campaigns that optimize for another action, such as a sign-up, count that action instead.

CPA is easy to compare with your margin. If a product leaves 20 euros per order before ads, a CPA under 20 euros makes money on the first order and a CPA above it loses money, unless repeat purchases make up the difference. Here is how to bring it down.

  • Raise the click-through rate with stronger creatives, so fewer impressions are wasted.
  • Improve the conversion rate of the landing page.
  • Give the platform enough conversions to learn from before you judge an ad set.
  • Refresh creatives when ad fatigue sets in.

Common mistakes: comparing CPAs across products with very different prices, and counting only the first order for products people buy again.

CPA describes a campaign. To see what winning a new customer really costs across all channels, look at CAC.