CPM

Description

CPM stands for Cost Per Mille, a Latin term meaning 'thousand.' In digital marketing, CPM refers to the cost an advertiser pays for one thousand impressions of their ad. It is a commonly used metric in online advertising to measure the cost-effectiveness and reach of an ad campaign. By focusing on impressions rather than clicks or conversions, CPM allows advertisers to gauge how many times their ad is viewed, which can be particularly useful for brand awareness campaigns. Unlike CPC (Cost Per Click) or CPA (Cost Per Acquisition), CPM doesn't rely on user interactions but rather on how many eyeballs see the ad. It’s an ideal metric for companies aiming to maximize their ad visibility and reach a broader audience without necessarily requiring immediate user action.

Examples

• A fashion brand runs a display ad campaign on a popular lifestyle website. They agree to a CPM rate of $5. If the ad is displayed 100,000 times, the total cost for the campaign would be $500.
• A tech company launches a video ad on a streaming platform. With a CPM of $10, and the video getting 250,000 views, the company would spend $2,500 for those impressions.

Additional Information

• CPM is often used in display advertising, video ads, and social media platforms where visibility is a key objective.
• It’s a crucial metric for brand awareness campaigns but may not be the best choice for performance-based campaigns focused on direct conversions.