If you’re able to track your acquisition cost in each advertising channel, that is, the cost per action (sale or lead), then you’re in good shape. And that means you are in a position to try several things that could lower that cost.
In the digital advertising world, whether it be display, search marketing, social ads, etc., there are really two broad ways you can lower your CPA (cost per action or cost per acquisition). Those are lowering your cost per click, or increasing your conversion rate.
But within each of those buckets, there are several options. Here are 6 ways that you can lower your advertising CPA:
1. Write better ad copy – in search or other text-based ads, testing your ad copy can lead to more enticing ads that get more clicks in the same position. All else being equal, this will lead to more people landing on your site.
2. Design better ads – in display, where you will often be paying per impression and not per click, increasing your click thru rate can make a huge difference in your costs. More clicks means more visitors at the same price. So testing more attractive, attention-grabbing ads could drastically lower your CPA.
3. Negotiate lower rates – in a bidding situation like Google or Facebook, you can control bids and positioning to lower your costs, but with display advertising, working with publishers or ad networks to lower your CPM (cost per thousand impressions) is a good way to control costs. All else being equal, lower impression costs should lead to lower CPAs.
4. Cut out ineffective placements – this applies to your advertising as a whole, as well as to each individual channel. Lower your investment or turn off altogether those ads that are not producing cost effective results. You can do this in search with negative keywords, and in display by choosing specific sites not to advertise on.
5. Better calls to action – in the second bucket, increasing your conversion rate, we assume that the click has already happened and the prospect has landed on your site. A better call to action on that site could lead more people to take the desired action. Add urgency or create a special offer to get more people to buy or sign up.
6. Clearer, more effective landing pages – not everyone who clicks on your ad and lands on your site will convert, but you can definitely increase the likelihood that they do by working on creating better landing pages. An effective landing page orients the prospect, gives them the most important information they need to make a decision right away, and starts them on the path to signing up or purchasing.