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Cost per action marketing is being touted as being much more beneficial than the tried and true
cost per click advertising. Although cost per action or CPA as it is referred to is not a new method
of marketing it has become quite popular. So what does it mean, how does it work and should I
use it.
For an illustration consider a company wishing to expand their product sales. Traditionally they
would develop an advertising campaign to have customers contact them for more information.
Once they have the contact information the company can provide additional information and keep
following up on the contact.
The company will keep track of the money spent on the advertising campaign and managing the
campaign. Money spent on the campaign divided by the number of sales leads it produced will
give a dollar figure of how much it costs to acquire a single lead. For example if the advertising
campaign and managing the campaign cost $10,000 and the campaign produced a thousand
leads the cost per lead would be $10.00. Conceivably then the company working through a cost
per action marketing network could offer up to $10.00 per lead.
The fee is paid for an action taken on the part of the one inquiring about the product or service.
This action could involve signing up for a newsletter, free report, more information or even
purchasing the product. When the action is taken the company can now work the lead for about
the same cost as before and maybe even less.
Wow! $10.00 an action, affiliate marketers could really make some money with that. Well yes and
/or maybe. There is money to be made with cost per action marketing. Remember the company
initially was spending money running and managing advertising campaigns to acquire leads. The
affiliate marketer will have to do something like that to acquire leads. Affiliate marketers may have
an advantage as this is what they do and they have developed marketing strategies that work for
them. Although because of their expertise they will be able to minimize costs associated with
acquiring the leads there will still be costs involved with setting up websites, providing a splash
page, an effective sales page, and advertising expenses. Often the affiliate marketer will use pay
per click (PPC) advertising to drive traffic to his lead capture page. If the cost of promoting your
offer is less than the cost per action premium, then and only then have you made money.
If we compare cost per action marketing to cost per click marketing some of the differences stand
out. Cost per click marketing say using AdWords provides several alternative adverts to click.
There are more chances of getting someones attention. Granted the revenue from clicking a CPC
ad is much less than if an action is taken with a CPA ad. The CPA clicks are much harder to come
by. It is important to give this some thought. The same effort should go into selecting a cost per
action marketing niche as you would put into selecting a niche to market your product. Pitching
your product to a niche where the people have a history of not spending any money will produce
the same results no matter what you are promoting. If you are confident and feel you know what
you need to do and feel that cost per action marketing is for you especially after you have done
your homework then go for it.
Maurice Petersen is an affiliate marketer using articles to drive traffic to his blog. Visit my blog at
http://www.stayhomeandworkonline.com and sign up for a free 19 page ebook: 3 Keys to Creating
big Time Commission Checks.
Article Source:
http://EzineArticles.com/?expert=Maurice_Petersen
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For More on What is Cost Per Action Check This Out:
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