Posts Tagged ‘CPA (Cost Per Action) Bidding’
CPA (Cost Per Action) Bidding
Cost Per Action (CPA), also sometimes referred to as Pay Per Action (PPA), is a way to advertise that allows you to only pay for each conversion instead of paying each time someone clicks on your ad with Pay Per Click (PPC). An action is determined by the advertiser and is whatever the desired outcome is, for example, it might be making a purchase, filling out a form, taking a survey etc.
CPA allows you to have a little more control of your advertising budget allowing you to only spend money on terms that are driving lucrative traffic to your site. Since you only pay when certain actions are performed CPA is a low-risk advertising investment. This allows you to have more control of you ROI (Return On Investment).
To meet your ROI objectives you need to have successful CPA bidding. There are three ways to do this:
By Hand – Determine your CPA goal and raise and lower your bids in order to reach that goal.
Paid Tools & Service – There is an array of bid management services and tools that will help you meet your ROI goals by automating the bidding service and managing your bids. This can save you time as well as help you to minimize conversion costs.
Google’s Free Tool – If your account qualifies Google has a free conversion optimization service that you can take advantage of.
Here are a few pros and cons associated with CPA (Cost Per Action) that should be considered before buying into a new advertising plan.
Pros:
- As an advertiser you can be sure about your investment and ROI. It is easy to see how effective the CPA is based on the money you are spending versus the money you are making.
- Can avoid click fraud sometimes found in Pay Per Click advertising.
Cons:
- You have to have an impressive website and site history in order to be eligible for CPA network membership.
- You have to get traffic to the CPA offers.
- It can be difficult to manage and requires good tracking technology.
If you are considering a change in your advertising campaign look at your goals and then consider giving CPA a try.