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Conversions

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# 1
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Can any one help me in Understanding how do we calculate CPA or Cost Per Lead ?

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Re: Conversions

Rising Star
# 2
Rising Star

Hi Mithun,

 

CPA is the total cost divide by total conversions. Let's say you've spent $100 and received 5 conversions, CPA would be 100/5 which is $20. More about the bidding method here.

 

Cheers,

Sumanth

Sumanth Sridhar

Re: Conversions

Top Contributor
# 3
Top Contributor

Hi Mithun,

 

In terms of AdWords, CPA stands for Cost per acquisition. It basically is a measure of the costs that you bear to acquire a new customer. Hence, when you are able to keep it low, your marketing is termed to be efficient. 

 

Let's take a general example to make a breast of the CPA concept-

 

You spent $1000 to get 25 conversions in a month. It means your cost per conversion is $40 (1000/25). 

 

Now you can take this $40 as CPA bid where you would tell AdWords that you are willing to pay $40 for an acquisition. AdWords will now try to bring you conversion cost below this amount. It will show you ads to the people who are more likely to convert. AdWords finds this out based on your campaigns' performance history. This method is called CPA bidding. 

 

Learn more about CPA Bidding here https://support.google.com/adwords/answer/2472713?hl=en

 

Thanks
Ratan

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