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C
Cost per Conversion (CPC)
Definition
Cost per Conversion (CPC) is the average amount a business spends to drive a specific desired action, like submitting a form. It measures the efficiency of campaigns in achieving high-value outcomes.
Expanded Explanation
CPC is calculated by dividing the total campaign cost by the number of conversions:
CPC = Total Campaign Cost ÷ Number of Conversions
In B2B marketing, a “conversion” typically refers to actions that signal strong buying intent, such as requesting a product demo, registering for a consultation, etc.
Why CPC matters:
ROI Focus: Helps to allocate budgets to campaigns that drive the most qualified leads (e.g., a 50€ CPC for a demo request vs. 5€ for a whitepaper download).
Campaign Optimization: Helps identify underperforming ads or channels (e.g., LinkedIn ads for enterprise SaaS may have a higher CPC but attract higher-value leads than Google Ads).
Scalability: Low CPCs enable businesses to scale campaigns profitably.
Practical Application for B2B SaaS/CaaS
CPC is calculated by dividing the total campaign cost by the number of conversions:
CPC = Total Campaign Cost ÷ Number of Conversions
In B2B marketing, a “conversion” typically refers to actions that signal strong buying intent, such as requesting a product demo, registering for a consultation, etc.
Why CPC matters:
ROI Focus: Helps to allocate budgets to campaigns that drive the most qualified leads (e.g., a 50€ CPC for a demo request vs. 5€ for a whitepaper download).
Campaign Optimization: Helps identify underperforming ads or channels (e.g., LinkedIn ads for enterprise SaaS may have a higher CPC but attract higher-value leads than Google Ads).
Scalability: Low CPCs enable businesses to scale campaigns profitably.
Example
SaaS Example:
A Compliance SaaS company runs LinkedIn ads targeting compliance officers at SaaS startups. The campaign spent 2,000€ and generated 25 demo requests, resulting in a CPC of 80€. By refining the ad copy to highlight “Automated GDPR Compliance for Startups” and retargeting prospects who viewed case studies, they reduced CPC to 60€ while maintaining conversion quality.
CaaS Example:
A Digital Transformation Consulting firm uses Google Ads with keywords like “digital transformation roadmap for manufacturing.” The campaign spends 1,500€ driving 15 consultation bookings (CPC: 100€). After adding a lead magnet (“5-Step Digital Maturity Assessment”) to address prospects at a different stage in their Buyer’s Journey, CPC drops to 75€, with 20 bookings at the same spend.