CPA advertising is starting to become a more sought after type of promotional medium and 2012 promises to be a prosperous year for savvy marketing experts. CPA stands for cost per action and is a form of advertising where the company only compensates a publisher when a particular action is carried out. Consequently, no matter how many folks click through to their website, the company will only pay a commission if a sale is made or a lead obtained.

Compared to other forms of online advertising, CPA provides a higher conversion rate because the visitors are already open to the thought of making a purchase. This is because they have previously been pre-sold by the online marketers, who also want their site visitors to convert, as this is their primary means of making money. It essentially places the advertiser and the publisher on the same page, each working towards the same objective.

On the other hand, a marketing platform such as pay per click, or PPC, performs just like an ordinary newspaper classified advertisement. In other words, an ad is written and then published and, depending on its quality, will help to attract visitors to an offer or order form. PPC is Unlike CPA, as traffic arrives cold and the chance of conversion is a lot lower. Yet another disadvantage is that every single click has to be paid for, regardless of whether the prospect signs up, purchases or leaves.

CPA is favored by advertisers for the plain fact that it gives more control over their bottom line. They appreciate that they will only be paying out if they have made a sale therefore their advertising costs will no longer be indirect expenses and part of their operating costs, but variable costs connected to a sale. Actually, the advertiser is placing all of the risk on the publisher and because of that, the commission rates with CPA advertising are much higher than with Pay per click advertising models.

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