CPA (Cost Per Acquisition) vs. CPC (Cost Per Click)

Are you confused about the difference between CPA vs. CPC? No worries, here is a simplified breakdown of CPA vs. CPC

What is CPC?

CPC stands for cost per click. The rate that websites charge advertisers every time someone clicks on an ad. If the CPC for a site is $50, and an ad gets clicked 1000 times over the course of the month, the advertiser pays the publisher $50,000.

Google is famous for its cost-per-click ad selling strategy—all of those Google Ads you see on your search results or next to your email? Google only charges those advertisers if you click on the ad. If no one clicks, Google makes no money.

In most cases, advertisers who go the CPC route don’t pay the same amount for each click. The amount they pay depends on several factors, including how competitive their desired keywords are. All else being equal, an advertiser will pay more for a coveted keyword, and less for one that is not as popular (i.e., a long-tail keyword).

As a result of the above, CPC doesn’t necessarily translate directly into a predictable number of clicks. In other words; a click on the same ad may cost an advertiser $1, $2 or $3 per click.

If an advertiser has a daily budget of $300 and uses all of it, that means they could have anywhere from 100 to 300 clicks. They’ll have more clicks if they paid a lower average CPC, and fewer clicks if they paid a higher average CPC.

What is CPA?

Looking to only pay for ads that drive action? Then you want to check out CPA or cost-per-action (also known as pay-per-performance (PPM) or cost-per-acquisition (CPA)). When a media company charges an advertiser using a CPA model, the advertiser only pays out if a user clicks AND does a specific ACTION.

What does that action have to be? Depends on the advertiser, which can vary from signing up for a newsletter, watching a video, requesting a callback, or taking any other desired and specified action. Every time this happens, the advertiser is billed accordingly.

Who Wins the Great CPC vs. CPA Battle?

Some advertisers utilize both CPC and CPA at the same time, but usually, it’s one or the other. When it comes to understanding and utilizing the method that’s best for your business you have two options. Research, analyze data, experiment, keep up with the latest Digital Marketing rules for advertising OR hire a team of experts. 

At DGM Global Marketing and Solutions we take advantage of the latest innovations in Advertisement Analysis. Using these tools, we can determine the method, or methods, best suited for your business. 

We connect your products or services to your potential clients by analyzing their click habits and convert appealing advertisement into leads. Your time is valuable, focus on your business while we will focus on bringing you business. 
Contact us Today to learn more about how we can drive traffic to your business and like us on Facebook for tips and updates about the digital marketing world.

References:

-What’s the Difference Between CPA vs. CPC? – Leap Clixx. https://www.leapclixx.com/blog/cpa-vs.-cpc

-CPM, CPC, and CPA: What’s the Difference? | Skillcrush. https://skillcrush.com/2012/07/11/cpm-cpc-and-cpa/