CPA pricing model – what it is about and why advertisers need it

All about CPA, CPM, CPC pricing model

There is a great variety of online advertising pricing models. Everything has started with CPC (cost per click). But it is not the only to sing a song now. We have a new and important player.

Cost Per Action means that after clicking an ad the visitor is expected to take a certain action, like loading the conference programm, subscribing to the news and others.

Formula

CPA = cost / amount of actions

Advertisers appreciate this model as it seems to give them feeling that they pay for the engagement they can track and estimate. Risk of wasting money is also kept to a minimum, as the situation of cost for every action or purchase is very transparent.

However, unfortunately, not everything is so bright here. Great problem that the connection with the client is almost lost. Everyone gets what he wants, but work on brand awareness is almost ignored.

What website advertising pricing will be the best?

It is hard to say, as following only one approach in any field is always a bit too unwise – you risk to lose other options and opportunities.

We have CPM (cost per mile) model. It covers the gap CPA can’t. Here we have no interest in clicks or conversions, but showing our ad. It is suitable for cases when you launch a new campaign and want to tell about new product or big sales.

Our old good CPC (cost per click) will attract traffic, that is not counted in CPA. Click model is also good when you want to invite a customer to your website and then give more information on your website or specially designed landing page.

You see, all of them make a pie delicious. And good variant to use them all. Implementation of each model means spending time on analysis as well and later you will see influence of which model should be increased.

Remember, it is always better to taste all the fruits from the basket, rather than eating only the first you took as you liked it.