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CPM, CPC, CPL or CPA, that is the question
It’s time to get all your online advertising actions under control and learn once and for all the differences between CPL, CPM, CPC and CPA. Stop getting lost with so many acronyms, names and concepts.
In this post we are going to clarify what CPL, CPM, CPC and CPA are so you can maximize the performance of your campaigns and ads.
Differences between CPM, CPC, CPA and CPL
How much do we pay for each of these types of ads? What’s the impact on our strategy?
The election of one of these ad campaigns depends on the goals that have been previously established.
CPM
The objective of this type of campaign is to impact as many people as possible. It is used to promote brand engagement and the advertiser pays for every 1,000 impressions, that is, every 1,000 times the ad has been viewed.
→ Objective: Branding
CPC
The success of this type of advertising lies in the ability of the ad to attract clicks and in the landing page. This type of campaign is normally used to increase the traffic to a specific landing page that is meant to convert a click into a customer.
→ Objective: More traffic
CPA
Cost per acquisition. The advertiser pays per transaction or sale.
→ Objective: Sales
CPL
It is a type of cost per acquisition, in this case, it is based on the ability of the ad to capture new leads. A lead is a potential customer or contact that you can impact through email marketing or any other mean.
→ Objective: New leads or sales
Definitions
To dispel any doubt you might have about these advertising models, I have put together a brief description of each of them along with a link to broaden the information.
What’s CPM?
CPM advertising model means cost per thousand impressions. If it is chosen as a payment option, the advertiser will pay each time the ad is displayed.
The objective is to show an ad as much as possible independently whether users click it or not.
What’s CPC?
Undoubtedly, CPC or Cost per Click is the most popular online advertising method amongst users. It is also very easy to use since you pay per click your ad receives. It there is no click, you don’t pay.
What’s the objective? Unlike CPM, our target is not to reach as many people as possible. The main goal is to get our audience to click the ad. That is, we want more traffic.
What’s CPL?
CPL means Cost per Lead. With this advertising model, the advertiser pays per new potential customer or lead, which means getting data or contact information from their audience. This information will be used to convert users into customers.
What’s CPA?
CPA or Cost per acquisition. The advertiser pays per sale or service hired. It is a great model to get more sales but at what cost? It is crucial to calculate properly the cost per acquisitions and the sales margin to make sure this is the best option.
See more Digital Marketing Definitions
Understanding the differences between CPM, CPC, CPA and CPL is crucial for the success or flop of an ad investment.
Do you have any question? We will read your comments.