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CPA stands for Cost Per Acquisition. It is a metric used in TikTokAds to measure the total cost of acquiring a customer. It is calculated by dividing the total cost of the ad by the number of conversions, such as a purchase, sign-up, or download. A lower CPA suggests that the ad campaign is more effective in acquiring customers.

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  • Tech details

What Is CPA?

CPA stands for Cost Per Acquisition and defines the cost incurred by a marketer or advertiser for a specific conversion that occurs as a result of their marketing efforts. This action could be a purchase, lead generation, email signup, app download, or any other desired outcome that aligns with the marketing campaign’s objectives.

CPA (sometimes referred to as Cost Per Action) allows advertisers to assess the effectiveness of their marketing campaigns. Knowing the cost per acquisition lets them determine how much they need to spend to gain a new customer or lead. Lower CPA is generally more desirable as it indicates that the advertiser is acquiring customers at a lower cost, making the campaign more profitable.

How to Calculate CPA?

The formula used to calculate CPA is the following:

CPA = Total Cost of Campaign / Number of Conversions or Actions

Here’s an example:

Suppose a company ran an online advertising campaign for a new product. They spent a total of $5,000 on the campaign, which included ad spend, creative production, and other marketing expenses. During the campaign, they tracked their conversions, and it resulted in 200 purchases of the new product.

In this case:
CPA = $5,000 (Total Cost of Campaign) / 200 (Number of Conversions)
CPA = $25 per acquisition

This means the company spent, on average, $25 for each customer acquisition or purchase made as a result of their marketing efforts.

What Is a Good CPA?

What you’ll consider a good CPA depends on where you run ads, your industry, and more.

For example, for B2B marketing, CPAs tend to be higher compared to B2C due to the complexity of B2B sales cycles. A good CPA for B2B campaigns could range from $50 to $500 or more, depending on the industry and product or service.

On the other hand, in the mobile app industry, a good CPA may be around $2 to $5 per app install, or a tad higher for more competitive app categories.

Based on the latest benchmarks provided by AdBraze, the average CPA across all industries for Facebook ads in 2022 was $18.68. According to this study, technology was the most expensive industry to advertise, while education had the most successful and least expensive ads.

Wordstream’s data shows that the average CPA for Google Ads range from $44 to $143, depending on the industry.

Keep up with future trends and instantly compare your performance to companies just like yours, regardless of your industry. Join our Benchmark Groups—it’s anonymous and free for everyone!

How to Improve CPA?

You can implement various strategies to improve your CPA:

  • Refine audience targeting: Identify and target the audience segments that are more likely to convert. Use Databox dashboard reporting to get the most complete and accurate picture of your audience and put together insights from various data sources to fully understand your performance.
  • Optimize ad creatives: Create compelling and relevant ad creatives that resonate with your target audience. Test different images, ad copy, and calls-to-action to find the most engaging combinations that drive conversions.
  • Use effective keywords: If you’re running pay-per-click (PPC) campaigns, use relevant and targeted keywords to ensure your ads appear to users actively searching for products or services like yours.
  • Improve landing pages: Ensure your landing pages are well-designed, easy to navigate, and provide a seamless user experience. Optimize the content and layout to encourage visitors to take the desired action.
  • Use retargeting: Implement retargeting campaigns to reach users who have previously shown interest in your products or services. Retargeting can help re-engage potential customers and improve conversion rates.
  • A/B testing: Continuously test different elements of your campaigns, such as ad copy, images, landing page layouts, and calls-to-action. A/B testing allows you to identify the most effective combinations for reducing CPA.

More resources to help you improve:

This metric has one or more equivalents:

Visualizations

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    Number

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    Bar and Line Chart

    Used to show comparisons between values.

How to track CPA in Databox?

Databox is a business analytics software that allows you to track and visualize your most important metrics from any data source in one centralized platform.

To track CPA using Databox, follow these steps:

  1. 1
    Connect TikTok Ads that contains the metric you want to track
  2. 2
    Select the metric you want to track from the list of available metrics
  3. 3
    Drag and drop the selected metric onto your dashboard
  4. 4
    Watch your dashboard populate in seconds
  5. 5
    Put CPA on the Performance screen
  6. 6
    Get CPA performance daily with Scorecards or as a weekly digest
  7. 7
    Set Goals to track and improve performance of CPA
TikTok Ads integration with Databox Track CPA from TikTok Ads in Databox GET STARTED

TikTok Ads CPA included in Dashboard Templates 1

  • Live view

    TikTok Ads Account Overview

    Get a high level overview of the performance of your TikTok Ads account.

    TikTok Ads

TikTok Ads CPA included in Report Templates 1

  • Details

    Social Media Ads Overview Report Template

    Enhance your social media advertising and dive into performance metrics for your Facebook, TikTok, LinkedIn, and X ads—all in one easy-to-use template. Perfect for understanding what’s driving results and optimizing your ad spend.

    Facebook Ads LinkedIn Ads X (Twitter) Ads TikTok Ads

Basics

  • Description
    CPA stands for Cost Per Acquisition. It is a metric used in TikTokAds to measure the total cost of acquiring a customer. It is calculated by dividing the total cost of the ad by the number of conversions, such as a purchase, sign-up, or download. A lower CPA suggests that the ad campaign is more effective in acquiring customers.
  • Category
    Advertising
  • Default Format
    PrefixCurrency
  • Cumulative Support
    No
  • Units
    No
  • Granularities
    daily, weekly, monthly, yearly, quarterly, allTime
  • Favorable Trend
    decreasing
  • Historical Data
    Yes
  • Changing historical data
    No
  • Forecast Support
    Yes
  • Benchmark Support
    Yes
  • Media Support
    No
  • Dimension
    N/A
  • Metric Type
    general Learn more
  • API Endpoint
    https://business-api.tiktok.com/open_api/v1.3/report/integrated/get

Questions? We've got answers.

  • What does a high CPA mean?

    High CPAs suggest that the marketing campaign or advertising efforts are not as efficient as they could be. The campaign might not be effectively reaching the target audience, or the messaging and offers may not resonate well with potential customers. It’s essential to analyze the marketing strategy, targeting, ad creatives, and landing pages, and conduct A/B testing to identify areas for improvement and cost reduction.

  • What can cause high CPA?

    Several factors can contribute to a high CPA (Cost Per Acquisition) in marketing campaigns, such as:

    • Poor audience targeting (reaching an uninterested or irrelevant audience)
    • Highly competitive industries or markets
    • Low-quality ad creatives that are not engaging, compelling, or relevant
    • Poorly designed or confusing landing pages
    • A complicated and lengthy conversion process
    • Seasonal fluctuations in demand and competition
    • Displaying ads at inappropriate times or on irrelevant websites
    • Poor bid management in online advertising platforms

    To address a high CPA, marketers should continually monitor their campaigns, analyze performance data, and make data-driven decisions to optimize targeting, creatives, landing pages, and conversion processes.

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