Cost Per Acquisition: A Trending Digital Initiative

cost-per-acquisition

Nobody is running a business for the sole reason of serving people, it may be the secondary or partial reason, but the major underlying reason remains the same; Revenue Earning.

Cost per acquisition (CPA) treads in that direction. It is a scalable and feasible way to make money but in a strategical manner, giving the returns a much better proportion compared to digital advertising.

CPA marketing allows you to pay at a rate that you determine only after the actions take place. The action can vary from making actual sales to asking for a quote or email submission.

For example, if you’re a cardigan seller costing $25 each and you’re setting up the CPA agreement at 20 percent for each cardigan sold, then you’d pay just $5 that even after collecting profits instead of paying in advance for the hope of making sales.

Therefore, the CPA is considered a preferred option by many marketers in the industry.

  1. Benefits of CPA marketing: Performance-based:The biggest advantage of having an affiliate program is that it is based entirely on efficiency. You’re not going to pay for ads that don’t bring profitable revenue to you because your partners only make money when they deliver quality traffic.
  2. Easy to measure:These services allow you to see certain items such as click-through rates or views of your website as a result of a customer visiting an affiliate website. This is a critical part of building an effective marketing plan for affiliates because it helps you to see which affiliates are working and which are not.
  3. Brand visibility:Affiliates can obtain listings of high search engines or show their ads on their websites. That’s all free advertising for the brand.
  4. Targeted customers:Affiliates choose the advertisements on their websites that they want to put. They know their audience and will select the most suitable campaigns for their demographics.

Though the concept of CPA marketing and Digital advertising is similar, it has some distinction making them entirely different at the same time.

  • Digital Advertising vs Affiliate Advertising:

Digital advertising or display advertising is a process where, through social media handles, one can promote their site, product or service. The idea is based on the perfect selection of audience and targeting and capturing them.

The ads displayed should be visually intriguing and stimulating that persuade users to convert a thought into action. Overall it is about spreading awareness and paying the influencers who can help further in increasing the no of the audience exposed to the marketing.

The affiliate market, though, is a side of the same coin, but it follows the same process backwards. Instead of paying influencers to promote the brand and convert leads. It asks influencers to lock leads and then get paid on a commission basis.

You need to create a credible website as an affiliate marketer, draw traffic to that website, and maintain a steady audience to sell ads.

Even if you are a beginner, CPA can be beneficial for your brand.

  • But how does CPA marketing works?     

The trajectory is between 3 major components involved:

  • Affiliate: The influencer (blogger, brand, company) who promotes a business or product to drive traffic to the e-commerce site and make a particular conversion.
  • Business: The brand that wants an affiliate partnership to drive quality traffic to the website of the company and increase sales, generate leads or boost conversions.
  • CPA Network: The forum that brings together the partner that wants to make money by promoting products and the businesses that want to promote their products.

They are brought together by the network, and the audience can try new products and learn about emerging brands. It’s a victory for all.

To get the ropes for the basic one should also understand the basic terminology of CPA marketing, it involves:

  • Affiliate Manager–A dedicated person from a network of affiliates assigned to help you increase your conversions and sales.
  • Daily Cap–This is the maximum number of converts that you can make to a daily deal. There will be no counting of conversions above that number. Your affiliate manager can always be asked to increase the daily cap. If an offer has a CAP, the offer page will mention it.
  • EPC–Earning stands by click. It is a measured sum by promoting a specific offer that affiliates receive per click (to offer page).
  • Reward–Many deals called reward offers can be found. This means you can provide a form of profit, cashback, or some kind of incentive for such deals to the client that attracts and convert to the offer you have promoted.
  • Vertical – Category. It could be education, sports, finance, BizOpp, and so on.
  • Offer Page – The page where the client converts after the specified action has been performed.

These are the fundamentals based on which every CPA marketing campaign is built. Still, the task does not end here; in order to continue improving your conversion rates, you must invest the time to cultivate a relationship with your CPA affiliates to create a strong conversion funnel.