CPA (Cost per Acquisition)
CPA is the average advertising cost to acquire one customer or conversion, calculated as total ad spend divided by total conversions.
CPA tells you how much you paid, on average, for each conversion your ads produced. A conversion can be a purchase, a lead, an app install — whatever action you're optimising for.
CPA is the bottom-line efficiency metric for performance campaigns. Unlike CPC or CPM, it captures the full funnel: your ad has to earn a click, the click has to load a page, and the page has to convert. If any step leaks, CPA rises.
To know whether your CPA is "good", compare it to your customer lifetime value (LTV). A healthy rule of thumb is CPA ≤ ⅓ of profit LTV.
Formula
CPA = Total ad spend ÷ Total conversions
Example
Related terms
CAC
CAC is the total cost of acquiring a new customer, including all marketing and sales spend across every channel.
CPC
CPC is the average cost you pay each time someone clicks your ad, calculated as total ad spend divided by total clicks.
CVR
CVR (conversion rate) is the percentage of visitors who complete a desired action — a purchase, signup or lead — after clicking through to a landing page.
LTV
LTV is the total revenue or profit expected from a single customer across their entire relationship with your brand.
ROAS
ROAS is the revenue earned for every dollar spent on advertising, expressed as a multiple (4x means $4 back per $1 spent).