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CPO (Cost per Order)

Cost per Order (CPO) is an accounting method from the field of online marketing.

Using the CPO model, the advertiser has to pay the publisher if a user not just clicks on his banner ad, but is then ordering a product or booking a service from the advertiser. Accordingly, CPO is a success-based payment metric like cost-per-install (CPI) or cost-per-click (CPC) are and builds a connection between affiliates and advertisers.

The purpose of the CPO metric is to measure the advertising cost required to acquire an order. If the main goal of a company is to generate sales, it usually prefers the metric cost per order.

It is calculated by simply taking the total amount of advertising costs and dividing it by the number of orders placed.

Since they are only paying for completed orders or bookings in the CPO model it is especially advantageous for advertisers. This way they are not wasting any money on expensive marketing campaigns that might just have a mediocre effect because of a low conversion rate.

You can find a detailed overview of all pricing models available in this article.