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Define the Click you should pay to match your Target CPA?

Visitor ✭ ✭ ✭
# 1
Visitor ✭ ✭ ✭

How would you define the Click you should pay to match your Target CPA?

 

In the analysis that I'm doing, that is give by (Conversions*Target CPA)/Clicks.

 

Does anyone else use this performance indicator?

1 Expert replyverified_user

Re: Define the Click you should pay to match your Target CPA?

Top Contributor
# 2
Top Contributor
Hi Max,
That's pretty much it. It's what everyone uses. It's the only way to measure it.
When you think about it, it's fairly intuitive. How much profit do I make per sale? I need to bid for a conversion that's lower than that. Simple.

If you earn $100 profit per sale and you have a conversion rate of 1%, you need to bid BELOW $1 per click to achieve that.

Hope that helps.

Re: Define the Click you should pay to match your Target CPA?

Explorer ✭ ✭ ☆
# 3
Explorer ✭ ✭ ☆
Hi Max,

I think you are doing a right thing. Finally, we all marketers are looking for improved ROI. If we are spending $100 on a particular ad and in return if its getting us say around $1000. Then I must say, it is a profitable calculation. So let's think it from a broader perspective, just not in terms of click or CPA. Think about the volume of business.

I hope this helps.

Kapil M

Re: Define the Click you should pay to match your Target CPA?

Participant ✭ ✭ ✭
# 4
Participant ✭ ✭ ✭
Hey!

Please read this related blog post on PPCHero about "Align your bids with your CPA within 5 minutes using AdWords Editor and Excel"
# http://www.ppchero.com/align-your-bids-with-your-cpa-within-5-minutes-using-adwords-editor-and-excel...

Abhishek