CPM, CPC and CPA describe successive stages of paid-media economics.
- CPM measures the cost of 1,000 impressions.
- CPC measures cost per click.
- CPA measures cost per completed acquisition.
Click-through rate links impressions to clicks; conversion rate links clicks or visits to acquisitions. A rising CPA can therefore come from a higher CPM, a weaker click-through rate, a weaker conversion rate or several changes at once.
Diagnose the chain before optimizing. Cheap impressions with poor attention can produce expensive clicks. Cheap clicks from weak traffic can produce expensive acquisitions. Segment by placement, audience and device without losing the blended business view.
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This guide is educational and does not provide financial, accounting, tax or legal advice.