Target CPA calculator
Work out the most you can pay for a customer, a lead and a click, starting from what a customer is worth to you. The numbers already filled in are the worked example from our guide.
Your numbers
What one customer pays you each month, on average.
Revenue left after hosting, support and payment fees.
Share of customers who leave each month.
Dollars of margin you want back for each dollar spent. 3 is the common default.
Share of ad clicks that fill in your form.
Share of those leads that become paying customers.
What you can pay
How the calculator works
Lifetime value comes first: revenue per account, times gross margin, times how long a customer stays. The average lifespan in months is one divided by your monthly churn, so 4% churn means 25 months.
The target CPA is that lifetime value divided by the return you need. At a ratio of 3 to 1, a customer worth $1,000 in margin gives a target CPA of about $333. The highest cost per lead is the target CPA times the share of leads that become customers, and the highest bid per click multiplies in the share of clicks that become leads.
The full method, and when to revisit the number, is in how to set a target CPA before you launch a paid campaign. If you bid on qualified leads rather than every form fill, enter the share of qualified leads that become customers as your lead to customer rate, and see how to send qualified B2B leads back to Google Ads.
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