CPA Is Overrated

A Better Way to Measure Performance Ads

There are multiple ways to measure creatives in performance marketing. We’ve got CPM, CTR, CPC, and CPA. At first, it looks like there are too many things to play with. Then we realize that the main metric is CPA (cost per action) and focus all our attention on creatives that drive trials and purchases. This approach works — but it misses one important dimension.

In subscription-based products, especially in B2C where the average purchase is small, it often takes several billing cycles just to recover ad spend, let alone make a profit. That means we need users who stay and keep using the product — not just people who convert once and leave. This is where optimizing only for CPA becomes risky.

It’s easy to imagine an ad that looks great, grabs attention, and gets people to try our offer. They might even complete a 20-minute quiz or ignore the downsides of our landing page just to give it a shot. But when they finally use the product, they realize it’s not what the ad promised and churn immediately. Leaving aside the reputational damage — refunds, disputes, and bad reviews — the numbers alone tell the story: users from such ads cancel quickly, retention drops, recurring payments fall, and we struggle to earn back the spend.

There’s a simple way to think about it: an ad is a window — we should be able to see the product through it. If we see something else, the window is dirty.

When we optimize only for CPA, we fall into a trap — promoting what sells, not what we actually deliver. And there’s a bigger risk: by focusing too much on CPA, we miss ads that might have a slightly higher cost but bring in customers with higher lifetime value (LTV). These are the users who truly match the product. If we tracked the right metrics, we’d identify such creatives earlier, test them more, and improve performance overall.

So what should we measure along with CPA? Retention is the first thing that comes to mind, but it’s tricky. People don’t always use the product daily, and that’s often fine. Plus, we need a faster signal to separate good and bad creatives.

A simple and powerful metric is the subscription cancellation rate — especially cancellations in the first 24 hours. Cancellations tend to grow at the same rate after that, and the creatives with the lowest early cancellations usually stay on top. It makes sense — users either find what they were promised or they don’t. They’re either our audience or they’re not.