Cost per mille (CPM) is a key metric used in digital advertising to measure the cost of displaying an ad to one thousand viewers. It is an essential component of digital marketing and advertising, and is used by advertisers and publishers alike to determine their advertising budgets.
In this post, we'll explore the basics of CPM, and answer some of the most common questions about it.
CPM, or cost per mille, is a metric that measures the cost of displaying an ad to one thousand viewers. It is calculated by dividing the total cost of the ad campaign by the number of times the ad was displayed (impressions), and then multiplying that by 1,000.
CPM is used in digital marketing to determine the cost of a campaign or ad placement. It is used by advertisers to estimate their costs and budget for campaigns, as well as by publishers to set prices for ad inventory on their websites.
CPM is one of several metrics that are used in digital advertising, including CPC (cost per click), CPA (cost per action), and CPL (cost per lead). While these other metrics focus on specific actions taken by users, CPM is a more general metric that measures exposure and reach.
Several factors can affect CPM rates, including the targeting options chosen for the campaign, the competition level for ad inventory, and the quality of the ad creative itself.
Ad tech platforms use CPM as a pricing model for their services. They charge advertisers a fee based on the number of impressions delivered for their campaigns.
Content marketers can use CPM to measure the effectiveness of their campaigns and to determine the cost of acquiring new readers or viewers. They can also use CPM to compare the costs of different advertising channels.
In conclusion, CPM is a crucial metric in digital advertising and marketing, providing valuable insights into the cost and reach of ad campaigns. Advertisers and publishers alike use CPM to set budgets, measure performance, and make informed decisions about their advertising strategies.