This metric helps you determine how much you’re paying for one completed action.

An action can be generating an email opt-in, producing a product sale or downloading a white paper. For example, if last month you spent $1,000 on advertising to generate 5,000 visitors and 20 of them subscribed to your newsletter, your cost per action for a newsletter subscription is as follows:

• Cost per action = total website spend / total conversion.

Or…$1,000 ad cost / 20 subscriptions = $50 cost per action

Note: It is important to use the same time range when gathering your advertising cost and your total completed actions.

Your cost per action shows how well your advertising and website strategies perform relative to your advertising investment. Ideally, you want a low cost per action. This is achieved by either increasing your conversion rate (adjusting your website strategy) or reducing your advertising cost (adjusting your advertising strategy).