My cost per click is fine but acquisition is expensive. What now?

The conversion rate is doing the damage. Halving the cost per click is hard; doubling the landing page conversion rate is often easier and has the same effect on acquisition cost.

Businessmarketing

CPC CPM CPA Calculator

The three cost metrics from one campaign, with the funnel rates that connect them. Improving cost per acquisition is usually a conversion-rate problem rather than a bidding one, and this shows which.

Also called: cpc calculator, cpm calculator, cost per acquisition.

Cost per acquisition

₹400

₹400 per conversion. Cost per click is ₹20 and cost per thousand impressions is ₹200. The funnel runs 1% click-through and 5% conversion.

Cost per click

₹20

Cost per thousand impressions

₹200

Click-through rate

Conversion rate

Return on ad spend

Revenue less spend

₹4,00,000

How this is calculated

An estimate, not an offer or a guarantee. Projected returns assume the rate you entered holds for the whole term, which no market does.

Method and background

How this is calculated

All three divide the same spend by a different denominator, so they move together and mean different things. Cost per click is a bidding outcome. Cost per acquisition is a business outcome, and the gap between them is the conversion rate. A campaign with a good cost per click and a poor cost per acquisition has a landing-page problem rather than an auction problem, which is the diagnosis this layout is for.

each is spend divided by the count it is named after; CPM multiplies by a thousand

S: Ad spend (currency)
i: Impressions (count)
c: Clicks (count)
a: Conversions (count)

Worked examples

Each of these is asserted on every build. If a change to the engine ever moved one of these answers, the build would fail before the page could print it.

a full funnel

Ad spend: ₹1,00,000
Impressions: 5,00,000
Clicks: 5,000
Conversions: 250
Revenue from those conversions: ₹5,00,000

Cost per acquisition₹400

Every figure worked by hand from the same spend

Open this example

no conversions leaves acquisition undefined rather than infinite

Ad spend: ₹1,00,000
Impressions: 5,00,000
Clicks: 5,000
Conversions: 0
Revenue from those conversions: ₹0

Cost per acquisition₹0

boundary: the guarded denominator

Open this example

no spend costs nothing per anything

Ad spend: ₹0
Impressions: 5,00,000
Clicks: 5,000
Conversions: 250
Revenue from those conversions: ₹0

Cost per acquisition₹0

degenerate case

Open this example

Method and limits

What it assumes

Conversions are attributed to this spend within the reporting window.

What it deliberately does not model

Attribution across channels and devices is the hard part and is assumed away here.
It counts the last click. View-through and assisted conversions are excluded.

Formula version 1.0.0 · definition 1.0.0 · India · Report a problem with this calculator

Frequently asked questions

My cost per click is fine but acquisition is expensive. What now?: The conversion rate is doing the damage. Halving the cost per click is hard; doubling the landing page conversion rate is often easier and has the same effect on acquisition cost.