What Is CPA Marketing?| Taboola.com

Advertisers are always seeking new ways to reach consumers, and sometimes they need a little help from their friends. Affiliate marketing serves to connect advertisers with partners who can help an advertiser promote their brand. One form of affiliate marketing is called cost-per-action, or CPA, which I’ll explore here.

What is CPA Marketing?

CPA (Cost Per Action) marketing is an affiliate marketing model where advertisers pay a commission only when a specific action is completed. Unlike traditional advertising, where you pay for impressions (CPM) or clicks (CPC), CPA focuses on actual conversions, such as Lead generation (e.g., filling out a form, signing up for a free trial), Sales (e.g., purchasing a product or service), App installs, Email subscriptions.

How CPA Marketing Works: 5 Basic Steps

In CPA marketing, an advertiser pays an affiliate — such as a publisher or blogger — to promote their product or service. The affiliate only receives a commission when the advertiser’s product or service is purchased, or some other relevant action is taken, making this budget-friendly for the advertiser upfront. Here is a breakdown of the basic process:

1. Advertiser Creates an Offer

A business (advertiser) sets up a CPA offer, defining the action they want users to take, which could be through a lead generation form, free trial sign up, finalizing a purchase, or downloading an app.

2. CPA Network Connects Advertisers with Affiliates

Many advertisers use CPA networks to connect with affiliates. The network handles tracking technology and reporting, billing management and more depending on the affiliate platform. Affiliates (brands or publishers) join these networks to find CPA offers to promote.

3. Affiliate Promotes the Offer

Affiliates use different strategies to drive traffic and encourage users to complete the required action through SEO-optimized blogs, social media marketing, email marketing, paid ads, influencer marketing, to name a few scaling strategies.

4. User Completes the Action

A user interacts with the affiliate’s content, clicks the CPA offer link, and completes the required action.

5. Affiliate Earns a Commission

Once the action is verified, the advertiser pays the affiliate a commission. The payout can range from a few cents to hundreds of dollars, depending on the action’s value.

CPA Marketing Example

For example, a fitness YouTuber might post a video praising a new heart rate monitor, or a popular food blogger might run a positive review of a new restaurant. If a consumer takes certain specified actions, such as buying the heart rate monitor, signing up for the company’s newsletter, or making a reservation at the restaurant, the affiliate earns a commission.

Generally, the affiliate and the business come together through a CPA network. The network connects affiliates seeking commission-earning promotional partnerships with businesses seeking partners to promote their offerings. Affiliates are chosen for numerous factors, including relevance of their own branding and likelihood of their followers to be interested in and purchase the advertiser’s product or service. They are also likely to have large followings, thus making it worthwhile for the advertiser to utilize them as a helpful voice in connecting with potential customers.

The Different Types of Actions in CPA Marketing

Pay per sale

With pay per sale, the advertiser pays the publisher or website owner an agreed-upon amount or percentage when a sale is made. It’s a cost-effective, performance-driven model that can help an advertiser drive profits.

Pay per action

In a pay per action agreement, the advertiser pays the publisher or website when a customer engages in a specific action, such as signing up for a trial experience with a product, or subscribing to a newsletter. This, too, helps advertisers maximize their budgets, because they only pay when the consumer takes certain actions.

Recurring

With recurring payments, the advertiser pays the affiliate every time a referred customer makes a payment, such as with a weekly subscription. This means the affiliate has an ongoing source of income from the advertiser based on the continued value of the customer.

Why Use CPA Marketing? Benefits for Advertisers and Affiliates

Both advertisers and affiliates have a lot to gain from CPA marketing, with one key difference being that advertisers generally have less risk. For the advertiser, this can be a great way to grow their audience and reach people that might not normally see their products’ ads or consider using them. These brands get to speak to the consumer using a website or spokesperson the consumer already trusts, which positions their brand as part of a familiar world. For the affiliate, it’s a chance to earn money and potentially turn that success into other money-earning opportunities when other brands see them as a valuable advertising partner.

How to Get Started

Research Appropriate Affiliates

You’ll want to start by getting a sense of which types of affiliates would suit your brand so you can create a conversation with a CPA network. The affiliate should speak to the kind of audience you’ve had success with, as well as new audiences you would like to test out.

Find a CPA Network

Next, you want to find a CPA network that offers an affiliate manager who can help you find the right partners, and negotiate pricing that is fair to you and will help maximize your ROI. Make sure to research the company and its reputation to make sure they won’t serve up inflated metrics, and that they’re committed to helping you reach your goals. The affiliate manager should be able to provide insights and strategies in terms of who you can pair with and how that partner can help you grow your sales.

At Taboola, our commitment to providing personalized support for each and every client is at the heart of everything we do. Our Growth department is specifically designed to meet the needs of smaller, agile businesses that are looking to scale quickly. Typically, affiliate teams with under a few dozen employees fall under this category.

Taboola is the largest native advertising platform, reaching more than 500 million daily active users across thousands of exclusive premium digital properties. Whether you run a comparison website, a single-product landing page, or something similar, Taboola has enough high-quality traffic for everyone, especially if you leverage the best practices to ensure this traffic converts.

We welcome all potential partners to reach out and collaborate with us. If you are an affiliate, we encourage you to register with us and reach out to a member of our sales and support team to learn whether your specific offers are compliant with our policy.

Below is a non-extensive list of CPA affiliate networks that have a proven track record of reliability and scalability. Most importantly, these CPA partners comply with Taboola’s Advertising Policy, which can be one of the affiliate marketing-specific roadblocks for a fast launch on our platform.

Common Mistakes to Avoid in CPA Marketing

You’ll want to avoid affiliate fraud and low-quality content by really researching your partners before signing up with anyone. With affiliate fraud, an affiliate artificially plumps up engagement metrics so they can gain higher commissions. A shady partner can use bots or other spam tactics to increase website traffic, with no actual benefit to the advertiser and no sales increase.

With low-quality content, a publisher might produce content that makes your brand look bad by association, due to a lack of elegance in the presentation or any other potential factors.

The Future of CPA Marketing: Trends and Predictions

As digital channels and other ways to reach consumers continue to increase, CPA marketing is well poised to grow in 2025. Marketers and affiliates will keep adopting new technologies in artificial intelligence that allow them to study and speak to their target audience in a personalized way. Increased use of mobile devices can lead to more location-based affiliate campaigns, and omnichannel campaigns will become more important as consumers become more fragmented along an ever-growing array of devices.

Key Takeaways

Cost-per-action marketing is a mutually beneficial relationship between an advertiser and an affiliate, such as a publisher or blogger. Before jumping in, it’s important to research appropriate affiliates and find a CPA network you want to work with.

Frequently Asked Questions (FAQs)

Is CPA marketing really worth it?

CPA marketing is worth it for the advertiser, because it’s low risk and has the potential to greatly enhance profits. It’s worth it for the affiliate, too, if there is a strong likelihood that they will benefit from partnering with the advertiser.

What is the CPA model in marketing?

The CPA model in marketing is one where an advertiser pays an affiliate to promote their brand. The connection is normally made via a CPA network, which finds a relevant match for a brand’s product or service. The affiliate only receives a commission when their promotion has led to a sale or certain actions regarding the advertiser’s inventory.

What is the formula for CPA marketing?

With CPA marketing, the formula is total cost divided by total number of new customers. In other words, you divide the total cost of your campaign by the number of new customers you attained with the affiliate promotion.