AM 101: What Is Cost Per Action?
In this class, I’m going to break down some of the basics of Cost Per Action (CPA) Marketing. CPA is one of the first methods I used to make money online and it’s how a lot of internet marketers start off. It can be low cost, it’s very newbie friendly, and you can earn a good chunk of change over time. Some people strictly do CPA to earn money online so it’s definitely a proven money earner.
Terms To Know
- Action: What the visitor must do in order for you to get your payout. Also referred to as Conversion Point.
- Payout: The amount of money you get paid when the visitor completes an action.
- Incentive: A reward the affiliate (you) gives to visitors to motivate them to complete CPA offers.
- Content Locker: Restricting access to the content of a web page until the visitor completes a CPA offer.
- Earnings per click (EPC): The average amount you make for each visitor you send to the CPA offer. To calculate EPC, divide the payout by the number of clicks.
- Email submits: A type of CPA offer where the action that needs to be completed is submitting an email address.
- Leads: The amount of people that complete the CPA offer.
- Impressions: The amount of people who see the CPA offer you’re promoting. For banners, this will be shown as Image Impressions.
- Tracking ID: Allows you to segment your different CPA campaigns.
- CPA Network: A website that contains various CPA offers for affiliates to choose from.
How CPA Works
CPA is very simple.
- Choose a CPA offer to promote
- Promote the offer via banners, reviews, or other methods
- The visitor clicks your affiliate link or banner
- The visitor completes the action
- You get paid
It’s as simple as that. The offers can include free samples, software downloads, free trials, or other promotions. The companies that you are promoting use CPA to capture leads or to get visitors to purchase a product. Some other terms you might see used for CPA are cost per acquisition, performance based advertising, or pay per action (PPA).
Here is an example of a CPA offer from one of the networks I’m a part of, AdWork Media (affiliate link). The offer is for a $100 gift card for RedBox. If you have an adblocker plugin installed on your web browser, you probably won’t see the ad below FYI.
If you click on that banner (supplied by the CPA network), you’ll be taken to this landing page.
For everyone that enters their email address for that offer, I get a $1 payout. The process is similar for most CPA offers. You can get really creative with how you promote your CPA offers. I don’t want you to think that you’re confined to just putting up an ad provided by the CPA network and hoping that someone clicks it. I’m going to make a post soon that shows you the exact method I used to earn my first $1 with CPA and it doesn’t have anything to do with putting banners on a site.
Measuring CPA Campaign Success
The good thing about CPA networks is that they provide you with all the tracking you need. This makes measuring the success of your CPA campaigns much easier. When trying to decide how successful a campaign is, a lot of marketers look at the number of leads/conversions and the EPC. Obviously the number of leads you get will be important because it shows how many people actually completed the offer.
But many internet marketers argue that EPC is the best determinant of how successful your campaign is and I tend to agree. On the surface, a CPA offer with a $10 payout might look much more attractive than one with a $2 payout. But if the $2 offer has a higher EPC, then it might be a better option to promote. When looking at EPC, you’ll see a global/average EPC and your own personal EPC for that offer like the pic below.
The global EPC is the average EPC from all of the affiliates promoting this offer. When you start promoting the offer yourself, you’ll see a number under the personal EPC. You can use these numbers to determine the success of your campaign. If your personal EPC is way below the Global EPC, then there’s an issue somewhere that needs to be addressed. It could have something to do with the way you’re promoting the offer or the quality of the traffic you’re sending to the offer. If your personal EPC is higher than the global EPC, then you’re doing something right.
Tracking ID’s
When you’re promoting the same offer through several different avenues, tracking ID’s are a must. Tracking ID’s allow you to compare the same campaign across all of the different methods you’re using to promote it or if you’re doing split testing. For example, in our Redbox offer, let’s say I had two different banners on my site advertising it; one on the sidebar and one in the middle of all my posts. I would want to give them separate tracking ID’s so I know which one is converting the best. Without tracking ID’s, I could have 50 conversions but I would have no idea which ad they were coming from. If 45 of the leads came from the ad inside my posts and only 5 came from the sidebar ad, I would probably replace the sidebar ad with something else.
Content Locking
I want to briefly talk bout content locking because it’s a very popular method of using CPA. With content locking, you restrict access to a certain page until the visitor completes one of your CPA offers.
In order for content locking to work for you, whatever is on the restricted page has to be very intriguing. You’re making visitors take an extra step to access a page so they have to really want to see what you’re hiding or they’ll just exit. But when you have content that people really want to access, content locking can be awesome. Here’s a tip: Content locking is very popular in the *ahem* porn/adult niche. Without getting too graphic, let’s just say people on those sites are very “motivated” to see certain things under certain circumstances.
If you’re looking for a way to get started with making money online, I highly recommend CPA. There are so many different methods that you’re bound to find one that sticks. You can really get creative with it and make a lot of money with this. I’ll be posting a method I used to make money with CPA later so be sure to check back if you’re interested. Follow me on Twitter to get all my latest updates!
Extra Studying:
http://truepassiveliving.com/your-chance-to-bank-on-the-nba-finals-is-here/
