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Join early accessBreak-even CPA
The most you can pay to acquire an order before it stops making money.
Break-even CPA is the maximum cost per acquisition an order can bear before profit hits zero. It equals your contribution per order — price minus all variable costs (product, shipping, fees, returns). Hold your live CPA against it: below it you profit, above it you lose.
In practice
Break-even CPA is break-even ROAS expressed in dollars, and for most people it's the easier of the two to act on. "Don't pay more than $29.24 for an order" is a sentence you can put straight into a bidding conversation; "hold ROAS above 2.5×" needs a translation step every time. Same economics, less mental arithmetic under pressure.
It's most useful set per product rather than per account. A $200 item and a $30 item have wildly different room to pay for a customer, so a single account-wide CPA target will overpay on the cheap product and starve the expensive one. If your catalogue has a wide price spread, calculate it per product line and let campaign structure follow.
Formula
Break-even CPA = Price − variable costs per order
Example: $49.99 price − $20.75 costs = $29.24 break-even CPA.
What a good result depends on
Rises with your margin; compare it to actual CPA per channel.
Common mistakes
- Leaving shipping, fees and returns out of variable costs.
- Comparing CPA to revenue instead of contribution.
Questions people ask
- What's the difference between break-even CPA and CAC?
- Break-even CPA is a ceiling you calculate from unit economics — the most an order can bear. CAC is what you actually paid, measured per customer. One is the target, the other is the result.
- Should I use first-order or lifetime value to set it?
- First-order contribution is the safe, cash-flow-friendly version. If you have reliable repeat data you can justify paying more against lifetime value — just know you're funding future profit with present cash.
- Why is my actual CPA above break-even on every channel?
- Usually one of three things: the margin behind the target is optimistic, the product is priced too close to its costs, or the offer isn't converting the traffic you're buying. Check the margin inputs first — it's the most common culprit.