Can Conversion API Reduce Your Customer Acquisition Costs: Here’s What you Need To Know

The digital world has afforded a lot of innovations in commerce and business. One of the most powerful things that software, technology, and smart data acquisition and activation can do is enhance customer experience. While the boom in technology and the rising prominence of the internet have afforded a lot of innovation, it’s also caused the level of competition to increase. With customers having more access to services now than ever before, companies have to work hard to not only stand out from the competition but secure investment.

What is Customer Acquisition Cost?

Customer acquisition is a term that describes a metric for how much money it costs for a company to get a customer to buy a service or good. It essentially is a measurement of the processes of successfully acquiring a new customer, that can then be analyzed next to the profit. This is how businesses can understand if their marketing, advertising, and customer interactions are actually representing a good ROI (return on investment).

For example, if the customer acquisition cost, or CAC, is higher than the actual profit resulting from the customer, then a business would need to stop and investigate. It doesn’t make sense to be spending more resources on acquiring a customer, than their investment warrants. This is an important part of understanding how to make sustainable growth that will help customers reach their goals.

There are a lot of tools that can be used to help lower the CAC of a business while still securing the customer. Ideally, the optimal outcome would be as little customer acquisition cost as possible, for the largest customer buy-in. The truth is, there will always be some form of customer acquisition costs as marketing, advertising, SEO, and website development will always be part of annual budgets. However, there are intelligent tools that can help enhance the effectiveness of a company’s customer acquisition strategies, and one of those is a conversion API.

What is a Conversion API?

A conversion API is a tool that has risen to prominence in the face of heightened privacy measures that have affected the internet across the board. To best understand what something like a Facebook conversion API is, you need to first understand what the Facebook Pixel, or Meta Pixel, was.

The Facebook pixel was a snippet of code that could easily be embedded on a website, typically handled via Google Tag Manager, that captured important information. This information was collected via the web browser, which offered third-party access to information that was important for conversion acquisition costs. The information that the Meta Pixel captured was relevant to customers and was funneled typically to add platform management software.

What Information Did the Meta Pixel Capture?

Essentially the main purpose of a pixel was to capture information that would allow marketing teams and software developers to create a more well-rounded, and thorough profile of the customer. This of course would be data that teams could use to not only increase customer experience but also help to make predictions about customer spending. Having the right kind of information to give insight into a customer’s interests helps companies hone in on potential sales.

The Meta Pixel itself captured 17 important interactions or events. This information included subscription information, viewing information, payment addition, purchases, checkout experiences, wishlist development, product customization, and even donation events. This information was then funneled back to Facebook and paired with the correct profiles. This connection allowed for ad software to target specific people with products that they may be interested in based on the acquired data.

The Move To Server Side

This system worked until major web browsers started offering beefed-up security that blocked this kind of third-party data collection. This created a real problem for businesses that had been benefiting from pixels and other code snippets because now they had no way of gathering important information that could lower their CAC.

Conversion APIs have since risen in popularity as the main solution to the added security that most major web browsers now offer. A conversion API, like Facebook’s Conversion API, has similar outcomes to the pixel, however, instead of working through a web browser, it is installed server side.

APIs in general are some of the most necessary tools in the digital world. They allow for the connection and integration of data between applications and without APIs, much of the digital world wouldn’t be able to exist.


The conversion API method is actually an evolution of the pixel in that it offers not only a more stable, dependable access to data but more variety and customization. Because it now works from the server side and is not dependent on a web browser, it can even capture offline events and acts as a more robust tracker of a customer journey. With better insight into customer needs, conversion APIs can be instrumental in improving the effectiveness of a company’s customer acquisition costs.