CPA is an abbreviation of Cost Per Action. As the name suggests that this is an advertising technique in which the advertiser pays for his ad only when the viewer of the ad takes any action on that ad. Now it is up to the advertiser that which action he wants his viewer to perform on the ad. For example, advertiser wants to sell his product so if the viewer of the ad buys the product while viewing his ad then an action will be performed on the ad and advertiser will be charged according to the agreement. Pay per Action i-e PPA is also another name of this technique. Some people confuse Cost Per Action with Cost Per Acquisition which is totally wrong because not every action is acquired.
Actions of CPA:
CPA consists of several types. Some of them are discussed below:
- A type of CPA is filling a form. You may be required to fill out a form in order to complete the action on that ad.
- The action required to be performed can be of subscribing to the newsletter of the advertising company.
- To get information about the viewer of the ad can also be a type of CPA. The information can be his name, Email, and other such information.
- Email Signup is a very famous action that could be performed.
- Sometimes full contact information like name, address, city, state, country and several other are also required to complete an action successfully.
- Travel booking is also an important action that could be performed.
- E-Commerce is also very much in nowadays.
There are many more actions which can be performed in CPA. These actions are different for every advertiser and depend upon the goals and objectives of the advertiser.
Moreover, there are some advertisers which are selling products online to their viewers. They set the cost of CPA according to the products that are sold. For example, there is an advertiser which is selling refrigerators and other electrical items. If a viewer buys refrigerator online then the advertiser will pay more amount. If a viewer buys a small electrical item like iron or kettle than he will be charged less.
Measuring the Cost Per Action:
There are several calculators available online to calculate your Cost Per Action. To do it manually, first of all, you have to calculate a number of actions. A number of actions can be found out by getting a product of the conversion rate of your ad to click through rate percentage. Once you get your number of actions, now divide the total cost by a number of actions and you will get Cost Per Action.
Cost Per Action advertising is usually used by associates because associates work with some company. Associates like CPA advertising because in CPA for every action performed by the viewer company will give a handsome amount to the associates. The action that is to be performed is decided between the company and associate. In this way, the company can get many leads which will provide them with promising customers in future.