This is a question had been rattling around for what seems like forever. Cost per click (CPC) vs cost per acquisition (CPA), which is best?
You could have this argument for as long as mankind (or women, I’m not sexist!) has been asking which came first, the chicken or the egg?
There is no straight answer. It purely depends on your business model, and more importantly, what your goals are.
In this article, I will cover what the differences are between CPC & CPA. The pros, the cons and which will suit you best.
Cost Per Click
Your traditional way of marketing on Google, CPC is paying on a cost per click basis. With this method, you will tell Google how much you are willing to bid per click.
Cost Per Acquisition
With CPA you are still paying google per click. However, instead of telling Google the maximum you want to pay per click, you will be telling Google how much you want to pay per acquisition.
If you are going with CPC, you will need to setup your maximum bids per keyword; it’s the basic form of working on Google Adwords. Depending on how it goes, how much you want to pay, conversion rates etc, you can then optimise and improve performance over time.
CPC gives you full control over what you want to do. You can budget yourself tightly, pay only what you want to and change bids on specific keywords. In a nutshell, you have full control over what’s going on.
With CPA, you basically give up that control and give it all to Google’s algorithms. All you need to do is set up your ad group and your CPA target for that group of keywords.
Google will then do everything for you, push up the cheap keywords, remove the shit ones, position and bid for everything accordingly. That’s the basics. Google will drill a lot deeper than that though. They’ll also display the best converting adverts for each keyword at the peak times and even optimise performance on different devices for maximum performance.
Even though I have rambled on a fair bit there. I probably still haven’t done justice to how good the CPA targeting on Google is. Very, very smart stuff!
You can see Google’s full guide to CPA targeting by clicking here.
Now CPA does sound very scary at first, but it can pay off big time.
So, let’s summarise some with pros and cons.
While there are a lot of positives for CPA, there are also plenty of negatives.
What you want to use comes down to preference, resource and what your goals are.
If you are a first timer, I’d suggest using CPC to start off with while you get to grips with AdWords.
If you are currently on CPC and thinking about CPA, there are no guarantees if it will do amazing, or crash and burn. It entirely depends on your goals and business model. I’d say if you are thinking about pure profit, give CPA a go.
Test, test & test! Performance wise, one or the other could do a hell of a lot better than you currently are. If it doesn’t work out within a few weeks, switch it back and everything will go back to as it was.
What do you use and why?