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Cost Per Action (CPA)

Definition

Cost Per Action (CPA) refers to the average cost incurred by an advertiser/business to acquire a conversion or desired action from a customer. In SEO, common actions include form submissions, purchases, signups, downloads etc.

CPA is calculated as:

Total Cost of Campaign / Total Number of Conversions

For example, if an SEO campaign cost $1000 and generated 100 conversions, the CPA would be $10.

Cost Per Action (CPA) Relevance For SEO

CPA is a useful metric for measuring SEO campaign efficiency and ROI. Since SEO aims to drive qualified organic traffic and conversions, calculating CPA allows you to determine the actual revenue impact of your SEO efforts.

A low and decreasing CPA over time generally indicates improving SEO performance in terms of rankings, traffic volume and conversion rate optimization.

Monitoring CPA helps identify which keywords, landing pages and campaigns are more profitable. This data can be used to optimize budget allocation to focus on high-ROI SEO activities.

Brief Cost Per Action (CPA) History and Evolution

  • Originated in direct response advertising in 1980s and 90s
  • Later adopted in pay-per-click (PPC) and affiliate marketing in late 1990s
  • Digital marketing channels like PPC and affiliate marketing made CPA more trackable
  • Recently, CPA has become popular in SEO as businesses focus on ROI

Cost Per Action (CPA) Best Practices for SEO

To optimize CPA in the context of SEO, there are several best practices to follow.

  • Keyword Research: Conduct ongoing keyword research to target high-commercial-intent search queries
  • Conversion Rate Optimization: Optimize landing pages to boost conversion rates
  • Proper Tracking: Leverage tools like Google Analytics to accurately track goals/conversions
  • Measurement and Improvement: Analyze performance data to identify profitable keywords and campaigns
  • Set Goals: Set specific CPA targets and monitor progress over time
  • Always Test: Experiment with new keywords and campaigns to expand reach
  • Prioritize Performance: Allocate budget to keywords and campaigns with lowest CPA