Understanding Your True Cost Per Action on Solar Leads

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September 8, 2022 | By RGR Marketing Blog

What Is Lead Cost Per Action and Why Is It Important?

When you are in a business that relies on nurturing leads, like the solar industry, understanding the true cost per action (CPA) on your leads is important because you need to know how much it’s really costing you to convert your leads into sales. If your leads are costing your business too much, then you need to make some dramatic changes quickly because you’re essentially throwing your money away.

But the good thing about using cost per action advertising is that you only pay when you have results. If your prospects do not complete the desired action, then you don’t have to pay any advertising charges for those prospects.

Why Knowing Your Cost Per Action is So Important

When you’re working with leads you have to spend money to make money. But the goal is to spend as little as possible, so your ROI can be as high as possible. In other words, the leads must be worth the cost it takes to convert them if your business is to remain profitable. The only way to know this is to know how much your leads are costing you.

If it turns out that you discover your leads are costing your business more than you expected, then there is usually a reason for this. The most common of which include:

Your marketing message isn’t reaching or speaking to your target audience
Your marketing message doesn’t feature a captivating Call-to-Action (CTA)
You’re working with unqualified leads
You’re failing to make your value offer clear enough
You’re targeting the wrong audience
You’re not providing your leads with the information they need to get closer to their purchasing decision
You’re coming on too strong
You aren’t engaging with your leads quickly enough

How to Calculate Your Cost Per Action

While it might seem like a daunting task, calculating your cost per action doesn’t have to be a time-consuming chore. There are a couple of ways to calculate CPA but the simplest way to do it is by dividing your total ad spend by the number of conversions.

CPA = Ad Spend / Number of Conversions

Here’s a basic example: If you spent $500 on an ad and it produces 100 conversions, then your CPA will be calculated as:

CPA = $500 / 100 = $5

So, in this case, your cost per action is $5 per conversion. The conversion is the action that you want your prospects to take, such as clicking on a link, submitting their contact information, downloading a free white paper, etc.

How to Lower Your Cost Per Action

Cost per action advertising can be an affordable marketing solution for some solar businesses, but it needs to be done right. If your CPA is higher than you want, then here are four ways to help lower it.

Make sure you’re targeting the right audience
Optimize your landing pages and run A/B tests regularly to maximize effectiveness
Improve your Ad Quality Score by making your ads more relevant to keywords
Use retargeting ads

Purchased Solar Leads Can Also Lower Your CPA

Another way to lower your cost per action is to purchase your leads from a reputable provider of solar leads, like RGR Marketing. Purchased leads from RGR Marketing provide your solar business with up-to-date contact information for people who have not only shown recent increased interest in solar, but who also fit your unique target demographic.

At RGR Marketing, we also verify our leads for accuracy and scrub them to remove any duplicates, incomplete profiles, or invalid information. With 20-plus years of experience serving solar marketers, we know what you’re looking for in a quality lead.

Partner with RGR Marketing today and you’ll get exclusive access to highly targeted solar leads that can help reduce your cost per action and acquisition. We can help you maximize your marketing ROI!

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What Is Lead Cost Per Action and Why Is It Important?

Why Knowing Your Cost Per Action is So Important

How to Calculate Your Cost Per Action

How to Lower Your Cost Per Action

Purchased Solar Leads Can Also Lower Your CPA

Start making more
money today!

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What Is Lead Cost Per Action and Why Is It Important?

Why Knowing Your Cost Per Action is So Important

How to Calculate Your Cost Per Action

How to Lower Your Cost Per Action

Purchased Solar Leads Can Also Lower Your CPA

Start making more money today!

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