CPS (Cost Per Sale)

What is Cost per Sale?

cps (cost per sale) refers to the total cost that a business incurs to make a single sale, which includes all marketing and sales expenses divided by the total number of sales.

Example: A software company partners with a digital marketing agency to boost its sales. If the software company spends $10,000 on a marketing campaign that directly leads to 100 sales of their $500 software, the cps would be $100. This means for each sale of the software, it effectively costs the company $100 in marketing expenses.

  • Enables companies to assess the efficiency of sales and marketing campaigns.
  • Helps in identifying the most cost-effective strategies for generating sales.
  • Facilitates better allocation of resources by pinpointing areas of high expenditure and low return.

Understanding cps (cost per sale) helps businesses optimize their marketing efforts, reduce unnecessary spending, and strategically plan their sales initiatives to improve profit margins.