Glossary / Cost per acquisition (CPA)
What is Cost per acquisition (CPA)?
Cost per acquisition is what you pay, on average, for one conversion. Divide the total campaign spend by the number of conversions it produced.
Spend 600 dollars on a campaign and get 40 signups. Divide 600 by 40 and your cost per acquisition is 15 dollars. That is the price of one result from that campaign.
A conversion here is whatever you decided to count: a signup, a booking, a download, a sale. Two teams reporting very different CPA numbers are often just counting different events, so write the definition down before you compare anything.
CPA on its own says nothing about whether the campaign was worth running. A 15 dollar signup is a bargain if those signups are worth 90 dollars and a disaster if they are worth 4. Pair it with what a customer is actually worth to you.