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Advertising cost per acquisition (CPA)

Also known as: CPA

Advertising cost per acquisition (CPA) here means the average advertising cost of a declared acquisition or conversion action: relevant campaign spend divided by the attributed actions within the defined measurement period.[3] That action may be a purchase, registration or signup; the denominator does not automatically count new customers only.[2] The cost base is narrower than fully loaded customer acquisition cost: CAC can also include sales and marketing staff, commissions and overheads.[1]

For a store, a completed form is not automatically a new paying customer. Define the chosen action and attribution window. If you specifically track advertising cost per new customer, label that narrower measure separately and state how first purchases are identified and existing customers excluded. Compare the result with the contribution from the corresponding customers or orders rather than their gross order value alone. With no measured actions, the ratio is undefined; that does not establish free customer acquisition.

Content updated:

Sources

  1. Customer Acquisition Cost (CAC) - Definition, Formula, and Example
  2. Cost per action: Definition
  3. Average CPA: Definition - Google Ads Help

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