Also called CPA, cost per action
Cost per acquisition is what it costs, on average, to gain one customer — total spend divided by customers acquired.
CPA is the number that decides whether paid acquisition is a business or a hobby. It is only meaningful next to lifetime value: a CPA of €40 is excellent if a customer is worth €200 and fatal if they are worth €30.
The common error is counting only advertising spend. If the campaign required a photographer, a landing page and three days of your time, those belong in the numerator — otherwise the channel looks profitable and the business does not grow.
CPA also rises with volume. The cheapest customers are found first, and scaling a campaign means paying more for each additional one, which is why a small profitable test does not guarantee a large profitable campaign.
In practice
€800 spent, 20 customers, gives a CPA of €40 — sustainable at €95 of lifetime value, ruinous at €25.
Common mistake
Excluding production and your own time. It flatters the channel and hides the point at which it stops working.
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