An Advertiser Enables Target Cost-Per-Acquisition (cpa) Bidding and Notices that Conversions Decrease. What Might Cause This?

An advertiser enables target cost-per-acquisition (CPA) bidding and notices that conversions decrease. What might cause this?

  • The conversion tracking code snippet was not added to the site
  • The target CPA bid was lower than the recommended amount
  • The cost-per-click (CPC) bid was lower than the recommended amount
  • The target CPA bid was higher than the recommended amount

Right Answer:

  • The target CPA bid was lower than the recommended amount

Explanation:

https://www.wordstream.com/cost-per-action

CPA is generally to refer to as the Cost Per Acquisition or Cost Per Action which is a metric that measures how much you are paying in order to attain a conversion from your user. In general, your CPA will be more than that of your Cost Per Click (CPC) because not everyone will be clicking on the ad desirably as some users will click on the ad unfortunately without any intention in doing it.

  • Like the Pay Per Click (PPC), your CPA will also be directly affected by your Quality Score.
  • But if your Quality Score is higher the lower will be your costs.
  • In fact, if your Quality Score is above the average of 5 in Quality Score then your CPA will drop by 16%.

So, keeping your Quality Score high and your CPA low can be a huge benefit to your PPC budget over time.

Also, if your Quality Score is low then there will be an increase in your CPA relative to your Competitors which will affect your Return of Investment (ROI) in the end. Average CPA is mostly depended on your business model and industry.

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