What is CPA in digital marketing?

Cost Per Acquisition (CPA), also known as Cost Per Action, is a key performance metric that measures the average cost of getting a single customer or conversion. It allows you to evaluate the efficiency of your advertising channels and make data-driven budget decisions.

How is CPA calculated?

The formula is straightforward: divide the total campaign cost by the number of conversions achieved.

CPA = Total Cost / Number of Conversions

Practical example

Suppose you run a Google Ads campaign with these results:

  • Total cost: $1,000
  • Conversions achieved: 50 purchases
  • CPA: $1,000 / 50 = $20 per acquisition

This means each customer costs you $20 on average. If your average order value is $80, your margin after acquisition cost is $60 — a healthy ratio.

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