How to Lower Your Cost Per Acquisition

Posted on February 4, 2010
Affiliate Marketing Tips, Google AdWords, Landing Page Optimization, PPC Keyword Tools, Pay Per Click, Toronto SEM Consulting |

How to Lower Your Cost Per Acquisition (CPA)

Cost Per Acquisition (CPA) advertising, or Cost Per Action advertising, is a method of paying for advertising that allows the advertiser to pay for each conversion such as a download, transaction, and lead instead of paying each time someone clicks on the ad. In other words, the advertiser only pays when the user completes a transaction. When differentiating CPA vs. CPC (Cost Per Click), with CPC, the advertiser pays each time someone clicks on the ad.

The best way to lower your CPA is to maximize your keywords so that you are using keywords that people use when searching for your product and service.  You must be able to turn your keywords into a sale. This involves constantly looking for quality keywords so you gain a competitive edge and that the researched keywords result in a profit. One important step you should take is setting a maximum cost-per-acquisition (CPA). This is the bid you are willing to pay for a conversion such as a transaction. For instance, if your maximum CPA bid is $5.00, you will not pay more than that price. You may also end up paying less depending on what others are bidding. You have the option to increase or decrease your maximum bid, depending on your marketing strategy. Google’s recommended maximum cost-per-acquisition (CPA) is the ad group bid that they suggest to help an advertiser keep costs steady.

Other than Google’s free conversion optimizing service, there are also cost per action paid service companies that specialize in finding the right keywords and setting the price. There are keyword research services available that provide advertisers with the ability to continually research keywords and create a relevant and effective list of keywords that will help them increase site traffic and lower their cost per acquisition. It is an effective method of controlling advertising spending and reducing advertising waste. People can also manually set keywords and bids themselves. Cost Per Acquisition Optimizing is an important tool if you are looking to optimize the number of conversions to maximize your advertising dollars.

Quality Score is another way to lower your CPA. Quality score is a grade search engines apply to your advertising campaigns. The higher a search engine grades your campaign, the less you will be charged. As well, you ads will become better established in the ‘Sponsored Links’ column. Quality score is affected by ad text relevancy, keyword relevancy to its particular ad group, landing page quality, and the click through rate. By producing search engine friendly ad campaigns, you will reduce your advertising costs by permitting the search engine to generate reduced minimum bids and first page bid for your advertising account. With better CPA management, businesses can drastically improve conversions while lowering their CPA.

468 x 60

Comments

Leave a Comment

If you would like to make a comment, please fill out the form below.

You must be logged in to post a comment.

Toronto Marketing Posts


Categories


Archives


New Offers