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What's for me CPC or CPA?

[ Edited ]
Visitor ✭ ✭ ✭
# 1
Visitor ✭ ✭ ✭

Hello, 

 

My company and I are about ready to start listing our products on Google Shopping and through ads.

 

The problem is that the Boss whats to go with CPA but I'm not quite sure how it works. I've read the info about it but I'm still a bit confused. 

 

We don't want to pay for ads unless they are doing something for us, such as someone buying a product. I understand that the costs are different but other than that I don't know what to think.

 

Can someone clear this up for me a little bit?

 

Thanks

2 Expert replyverified_user

Re: What's for me CPC or CPA?

Rising Star
# 2
Rising Star

You may find this discussion of value:

 

Target CPA vs CPC bidding


Theresa
Google AdWords Top Contributor
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Re: What's for me CPC or CPA?

Top Contributor
# 3
Top Contributor

Hi Yorktowne, welcome to the Community.  

 

Further to the discussion identified by Theresa, allow me to offer some general advice.  If you're just starting out and have a list of products to sell, it's a really good idea to start small - maybe even with just one or two products - and to pick your best selling products for this initial period.  A lot of companies try to advertise their worst selling products in an effort to increase sales but this really has no logic as if they don't sell by other channels there's really no reason why they should sell well through paid advertising.


If you pick a very small list of good selling, high profit products to start with you'll have a better chance of getting a positive return on your investment from the word go and will feel generally better about the process.  Establishing a profitable set of products also allows you to "fund" the less profitable ones over time - though you should never continue to advertise those that make a consistent net loss.

 

As for CPC vs CPA in general, as Ryan said in the other discussion, CPA does require data to work at all well and if you haven't got quite a lot of data - and I mean multiple sales per day every day - then it may never work well.  Personally I've had little success with CPA bidding but then most of my clients are low volume, high profit Accounts which don't work well under this model.  Which way you go will ultimately depend upon your volume of sales and your own testing but in any case I think you'll need to start with CPC to get an idea of data.

 

So, pick a handful - no more - of your best products.  Assign a "test" spend over two weeks or so and then analyse.  Don't be tempted to over-analyse short periods; many Accounts only report healthy profits when viewed on a longer term basis so you need to have a decent time period to look over.  You also need to assign a decent budget for the test; although it's tempting to try a small daily budget so you're not spending much, this isn't really a fair or accurate test of the market - it's like only putting 10 flyers under car windshield wipers in a car park of 1000 cars.  You might not get any results and get a false impression of failure when if you'd put flyers under all 1000 you'd have returned a profit.  When testing it's always better to have a higher daily budget for a shorter period than a smaller daily budget for a longer one.

 

Jon

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