What is CPA (Cost Per Acquisition)?
CPA is how much you pay for a defined conversion (purchase, lead). It’s a core efficiency metric for performance marketing.
Understanding CPA
CPA depends on click costs and conversion rate. Boosting clarity and product relevance with catalog ads improves conversion, reducing CPA even at steady CPCs.
Why CPA (Cost Per Acquisition) matters
CPA matters because it sets clear guardrails for spend and provides a simple metric that teams can track weekly across campaigns and channels. When conversion values are similar, CPA enables apples-to-apples comparison across tactics and placements without the complexity of ROAS calculations. Monitoring CPA helps ensure acquisition costs stay within profitable ranges tied to your unit economics and contribution margin.
- Budgeting: Sets guardrails for spend
- Comparison: Useful across tactics with the same conversion definition
- Simplicity: Easy for teams to track weekly
How to Calculate CPA
- Formula: CPA = Ad Spend ÷ Number of Conversions
- Read by campaign/placement and by product set for accuracy.
Meta Information
- Primary Keyword: CPA (Cost Per Acquisition)
- Secondary Keywords: cost per conversion, tCPA, CPA formula
- Target Word Count: 800–1,000 words
- Meta Title: What is CPA? Cost Per Acquisition Explained | Marpipe
- Meta Description: CPA measures how much you pay for a conversion. Learn the formula, pitfalls, and how creative/feed changes lower CPA.
- URL: marpipe.com/ad-glossary/cpa-cost-per-acquisition
# What is CPA (Cost Per Acquisition)?
CPA is how much you pay for a defined conversion (purchase, lead). It’s a core efficiency metric for performance marketing.
Understanding CPA
CPA depends on click costs and conversion rate. Boosting clarity and product relevance with catalog ads improves conversion, reducing CPA even at steady CPCs.
How to Calculate CPA
- Formula: CPA = Ad Spend ÷ Number of Conversions
- Read by campaign/placement and by product set for accuracy.
Why CPA (Cost Per Acquisition) matters
CPA matters because it sets clear guardrails for spend and provides a simple metric that teams can track weekly across campaigns and channels. When conversion values are similar, CPA enables apples-to-apples comparison across tactics and placements without the complexity of ROAS calculations. Monitoring CPA helps ensure acquisition costs stay within profitable ranges tied to your unit economics and contribution margin.
- Budgeting: Sets guardrails for spend
- Comparison: Useful across tactics with the same conversion definition
- Simplicity: Easy for teams to track weekly
Best practices
- Improve feed quality and on-ad clarity first.
- Keep conversion definitions consistent across channels.
- Separate prospecting vs. retargeting CPA.
- Avoid optimizing to CPA when order values vary wildly—use value-based goals.
- Use product-level video to lift intent and CVR.
How to Calculate CPA
- Formula: CPA = Ad Spend ÷ Number of Conversions
- Read by campaign/placement and by product set for accuracy.
How Marpipe Helps
- The Challenge: Lowering CPA requires improving conversion rates and creative relevance, but building high-performing creative variants manually is slow. Catalog ads can reduce CPA through product-level personalization, but managing feed quality and templates becomes complex. Testing which creative elements improve conversion and lower CPA requires manual tracking.
- Marpipe's Solution: Marpipe's enriched catalog feeds improve product relevance, which raises conversion rates and lowers CPA. Catalog creative templates add price clarity, review stars, and sale badges that improve conversion by setting proper expectations. Product-level video adds engagement that improves conversion without manual video production. Performance analytics show which templates and product attributes drive the lowest CPA by channel and audience segment.
- Proof Points: Brands using Marpipe's catalog creative see average CPA reductions of 20-30% through improved conversion rates and creative relevance. The platform's enriched feeds and templates ensure ads show highly relevant products that convert more efficiently.
- CTA: Explore Enriched Catalogs and see how Marpipe reduces CPA through improved conversion rates and creative quality.
Key Takeaways
- CPA (cost per acquisition) is ad spend divided by conversions; it shows cost efficiency per desired action.
- Lower CPA by improving CTR, conversion rates, and feed/creative relevance.
- Set CPA targets based on LTV, margin, and acceptable payback periods.
- Track CPA by channel, audience, and product category to identify efficient opportunities.
