Sep 15, 2021

3 Strategies to Strike a Better CPA Deal And Maximize Profits

Bethany Cowan

In the world of sales, CPA or "cost per action" is a type of conversion rate marketing that has proven incredibly valuable in the past. It is, however, possible to take this metric and come away with the wrong insights. That's why, if you truly want to strike a better CPA deal with your affiliates and maximize profits in the process, there are a number of important things to keep in mind.

Build Better Deals, Achieve Better Profits

By far, one of the most important ways to strike a better CPA deal and maximize your profits involves a technique called matchmaking to your traffic. This means coming to a better understanding of what works for both you and your audience and, more importantly, what doesn't.

This means taking the time to learn more about the price points that make the most sense given the people you're communicating with. It means learning their interests. It means coming to a better understanding of their demographics and more.

Keep in mind that this applies to all promotional materials, including those that are targeted to more general audiences.

How Much Commission Do you Need?

Another strategy that is worth paying attention to involves looking inward and asking yourself "how much commission do you need?" to begin with. Don't be misled by other, higher CPAs - the answer to that question can only be provided by you and you alone. Never forget the idea that return on investment will beat out CPA every single time in the long run.

To get to this point, you'll need to know your benchmarks like the back of your hand. If you don't know, test, test and test again - it's the only way to be sure that you're on the right path moving forward.

Consider the Vendor's Side

Finally, you need to be prepared to consider the vendor's side of this conversation. That means carefully considering not just yourself, but the entirety of the relationships that you've worked hard to build up to this point.

What are their own costs? If you don't know, you need to find out. What do you know about their business model? Where does their profit come from? What are their risks? Are they on the front-end or the back-end? Do they rely on upsells, subscriptions, repeat customers or all of the above? The answers to these questions need to dictate a lot of the decisions you're making from here on out.

In the end, never forget that the only way to scale is if both you and the vendor are as profitable as possible. This means that you need to know what happens in situations with low take rates, low stick rates, high returns and others. You need to be prepared to answer the litany of questions that they're likely to have.

But more than anything else, you need to convey a sense that you're all in this together. Not only will this help you build a far better CPA deal, but it will help you and your partners maximize your profits across the board. That in and of itself is the most important benefit of all.