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Cost Per Acquisition (CPA) is the marketing metric measuring the average cost to acquire a new customer. It calculates the total advertising spend divided by the number of new customers gained.
If a company spends $2,000 on a campaign and acquires 80 new customers, the CPA is $25.
CPA vs. CPC: While often confused, CPA focuses solely on new customer acquisition, while CPC measures the cost of any desired action or conversion.
Effective Use: CPA is crucial for evaluating the efficiency of customer acquisition strategies and determining the overall profitability of marketing campaigns.
By understanding CPA, businesses can optimize their marketing budgets and allocate resources effectively to maximize customer acquisition.