CPA Marketing: A Game Changer for Businesses

SarahHughes
September 20, 2023
November 8, 2023

In today’s hyper-competitive world, businesses are looking to make their marketing efforts cheaper and ever more measurable as they seek to squeeze every penny of value from every pound spent. Tangible return on investment is the name of the game. And that means spending marketing budgets in ways that acquire customers in the most efficient and effective manner. In these times, one strategy that is gaining ever more popularity is Cost Per Acquisition (CPA) marketing. Without doubt, CPA marketing can offer some fantastic benefits to businesses of all sizes. Here’s the lowdown.

So, What Is CPA Marketing?

CPA is a form of marketing where the advertiser pays a publisher (or an affiliate) only when a specific action or conversion is completed by a customer. The agreed action can take many forms depending on the advertiser’s objective. For example, it could be a sale, a lead, filling in a form, clicking through to a website or even an app download. Ultimately, the focus is all about the achievement of that final desired result. Imagine buying a fishing trip, but only paying for the fish you catch, not for hiring the boat or the time you spent on it. That’s CPA.

How It Works

Marketing objectives image

The advertiser, after identifying their target market, defines their marketing goals and objectives. They’ll then design a compelling and engaging advertisement to reach that audience and encourage them to take the desired action. The ads will have a tracking mechanism of some form built into the copy. Digitally, it could be a conversion tracking pixel, a tag or a snippet of code for example. In more traditional media, it could be a unique telephone number or promo code in a newspaper or magazine. A QR code can even be used to blend print and digital to create a ‘phygital’ CPA marketing method too!

Whatever the media selected, the actions are tracked. The resulting data is shared between advertiser and publisher/affiliate. Advertisers are then billed based on the actual number of actions or conversions during the campaign. They pay for each acquisition. The fee for each conversion is of course, agreed beforehand.

How Is Cost Per Acquisition Calculated?

Very simply! To calculate CPA in marketing, just divide the total marketing expenses by the number of new customers acquired during the same period.

What Is A Good CPA?

This can vary widely depending on the industry, business model, and marketing channel. Of course, the lower the CPA, then generally the better it is. Or course, it can indicate efficient marketing spending. But that doesn’t tell the whole story. Every business is unique – and to determine what’s a good CPA for you, consider your business’s unique circumstances, goals, and financial metrics.

Where You Can Do CPA Marketing

CPA is an incredibly versatile form of marketing. Wherever you can advertise, you can do CPA too! Digitally, you can use PPC, social media, online display, downloadable content, video marketing, email and apps amongst other options. In print media, you can look at newspapers, mags and direct mail. It’s even possible to do CPA marketing on TV and radio!

Benefits of CPA Marketing for Businesses

CPA Marketing A Game Changer for Businesses Benefits Image

Cost Efficiency

The ability to control costs is a major benefit of this marketing strategy. In more traditional advertising, you usually have to pay (often upfront) for placing ads. And of course, there’s no guarantee of results! With CPA marketing, you’re only paying when your desired action is completed. It’s tied directly to agreed results. This means that you don’t pay for advertising that doesn’t lead to those vital actions.

Measurability

Using performance tracking mechanisms, it’s easy to track how well your campaign is performing. You can see how much you’re spending to acquire your customers in real time. This also allows a great deal of flexibility. It’s easy to change ad copy and offers as you go to make the most of emerging opportunities.

Data

CPA marketing is data driven. Advertisers are able to gather fantastic information into how their customers behave and what their audience likes – and doesn’t like! These insights then allow businesses to make decision based on real data. They can then create the best strategies to drive the best results.

Risk

With traditional advertising models come an element of risk. Even the best campaigns aren’t always guaranteed to work. You’ll still need to pay the publisher in any event! But with CPA marketing, the risk is moved to the publisher (or affiliate). Also, as the publisher directly shares in the success of the campaign, it is in their interest to do all they can to make it work!

Scalability

Successful CPA campaigns are easy to scale, allowing businesses to grow at a pace they can control while keeping control of their marketing budgets. And with demonstrable results, additional publishers and affiliates are easy to attract. This allows new audiences to be targeted.

Flexibility

As the CPA model can be applied to almost every marketing channel, businesses can explore and test until they find the ones that are most effective for them.

How To Implement CPA Marketing Effectively

Sounds great doesn’t it? But before you start rushing to put a campaign together, you need to make sure everything is in place to give the best chance of success. Firstly, you must understand and define your audience correctly. Your objectives have to be clear, achievable, and measurable. Of course, you’ll need to have a target CPA in mind. But remember, it will need to be worth your chosen partner’s while as well as yours! Then, ensure you pick the best partners. Only great publishers, reputable affiliates and proven ad networks should be used.

When your deal is agreed and your campaign commences, continually monitor its performance. Use the data that emerges as you go along to improve results. Always keep an eye on your budget. Do not spend what you can’t afford, no matter how well conversions are going. Finally, make sure information is shared transparently with your partners. That’s how successful, mutually beneficial, and long-term partnerships are forged. Get CPA marketing right, and it can be a game-changer for your business. Get it wrong, and while you might not have wasted money, but you’ll have wasted your time.

Need help?

We are a marketing agency in Kent. We’re also experts in CPA marketing with a track record of success. If you’re in need of professional and experienced marketers to help jumpstart your marketing efforts, we can help. Our creative team helps businesses like yours achieve the marketing targets you are working towards. Contact us today to arrange a call to discuss all your marketing needs.

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How to get customers, sales, data and maximise ROI without spending a penny upfront!
Rhys Hughes
CPA is a form of marketing where the advertiser pays a publisher (or an affiliate) only when a specific action or conversion is completed by a customer.
CPA MARKETING: A GAME CHANGER FOR BUSINESSES
18/09/2023
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