If you’re sitting there looking at your pay-per-click numbers and wondering why your marketing costs are much higher than you’d like them to be, it is time you take a hard look at your cost-per-acquisition or CPA.
What Is It?
So what is cost-per-acquisition? Simply put, it is the costs associated with acquiring a new customer. This number is often larger than your cost-per-click because not everyone who clicks on your ad will complete the desired action of your business.
So what affects your cost-per-acquisition? Your CPA is directly affected by your Quality Score, which is Google’s important metric based on the overall quality of your keywords, ads, and landing pages. The better your Quality Score the more of your marketing dollars you save.
Why Is It Important?
When assessing if your marketing efforts are effectively working, your metrics are the most important aspect in determining your campaigns success. While clicks and impressions tell you how often people are seeing and clicking on your ads, these metrics do not give you a clear picture of exactly how your account is performing. These metrics do not give you any valuable information on how your account is performing or how much return-on-ad-spend you are receiving.
The only metric that tells you how effectively your marketing efforts are is cost-per-acquisition. Your CPA is the only metric that tells how much or little revenue your marketing efforts are generating.
Don’t be confused though, we are not discrediting other metrics like cost-per-click, click-through-rate, and cost-per-conversion. These are all important metrics that give valuable insights of their own. Your cost-per-acquisition gives you immediate tangible evidence of how well you are spending your marketing dollars.
When you know how much you make per customer from your marketing efforts, you can then know how much you are willing to spend to acquire a customer.
A common question about cost-per-acquisition is what makes a good CPA and how much should we be spending on acquiring a new customer? There is no set answer, as it widely depends on the value or revenue each new customer brings to your business.
Now you know what cost-per-acquisition and why it is important. Next step, is how you can lower it.
We know we do it better than our competition and we’re confident enough to tell you exactly how we do it.
We fully immerse ourselves into your business and understand the inner workings of what you do, why you do it better and what end goal you want to achieve. You may be wondering, why is this important? Improving your cost-per-acquisition starts with your account structure, campaign settings, targeting strategies and filters down to your remarketing campaigns and landing pages. A strong foundation will set up your account for long-term success. We then focus on creating tighter ad groups that contain more exact keywords, which in turn lead to more effective ads.
We don’t just hit play and sit back; at Directive Consulting we take a hands-on approach and dive into your account to optimize it to it’s fullest potential. Each week we spend hours monitoring the performance of your account from the ads we create to the targeting strategies we implement. Our goal is to take your account to the next level by lowering your costs and increasing the number of sales qualified leads you get.
When we perform our weekly account audits we analyze your keywords and perform extensive keyword research to find more qualified keywords to target. When performing our keyword research we take a “broad” then “narrow” approach. This means we initially start off by targeting modified broad match terms, in order to find those hidden gem keywords. From there, we narrow our targeting to specific keyword phrases. This is a process we take to refine our keyword lists for our clients and a very effective way to lower your CPA.
We pair our extensive keyword research with constantly testing various ad copy and apply it to the custom landing pages we create. This creates a seamless user-friendly experience that leads to better quality scores, which Google rewards by discounting the amount we spend on keyword bidding, lowering the amount our clients spend.
By targeting more specific keywords, writing more compelling ad copy that drives the right prospects, and using our landing pages to qualify your leads, we ensure that you are getting the leads that matter to you and ones that will translate into quantifiable return-on-investment and a lower CPA. Cause as we know, not all leads were created equal.