What is a cost-per-action (CPA) model?

The cost-per-action (CPA) model is an advertising payment structure in which advertisers pay specifically for a predetermined action taken by a user, such as a sale, lead, download, or sign-up. This model is highly effective for advertisers because it allows them to pay only when their advertising efforts result in tangible outcomes, which can lead to a better return on investment compared to other models where they might pay regardless of the action taken.

In this context, advertisers are incentivized to acquire quality traffic and ensure that their marketing strategies align with getting users to complete specific actions that drive business results. This model contrasts with other forms of advertising payment systems where payments may be based solely on impressions or clicks, reflecting different objectives and outcomes.

Understanding the CPA model is crucial for businesses focused on conversion and performance-driven marketing, as it directly ties advertising costs to measurable results.