What is Cost Per Acquisition (CPA)?

Cost Per Acquisition (CPA), also known as Cost Per Customer, is the total cost of acquiring one new customer through marketing efforts. It includes all marketing and sales expenses divided by the number of new customers acquired in a specific period.

When to track Cost Per Acquisition?

CPA should be tracked continuously to understand marketing efficiency, when evaluating different marketing channels, during budget planning, and when determining the profitability of marketing campaigns.

When might CPA be misleading?

CPA calculations can be inaccurate if attribution windows are too short, if lifetime value isn't considered, or if all marketing touchpoints aren't properly tracked. It should be analyzed alongside customer lifetime value.

What is the importance of Cost Per Acquisition in Marketing?

CPA helps determine marketing ROI, compare effectiveness of different channels, set appropriate marketing budgets, and ensure that customer acquisition costs don't exceed the value those customers bring to the business.