CPM

Definition

Cost per thousand impressions (technically, “cost per mille”).

Information

The CPM model refers to advertising bought on the basis of impression. This is in contrast to the various types of pay-for-performance advertising, whereby payment is only triggered by a mutually agreed upon activity (i.e. click-through, registration, sale).

The total price paid in a CPM deal is calculated by multiplying the CPM rate by the number of CPM units. For example, one million impressions at $10 CPM equals a $10,000 total price.

1,000,000 / 1,000 impressions = 1,000 units
1,000 units X $10 CPM = $10,000 total price

The amount paid per impression is calculated by dividing the CPM by 1000. For example, a $10 CPM equals $.01 per impression.

$10 CPM / 1000 impressions = $.01 per impression

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Tools

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Related Terms

eCPMclick-through rate (CTR), cost-per-action (CPA), cost-per-click (CPC)

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Courses

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Articles

Low CPM Rates Sow Discontent Among Publishers, Ad Networks
ClickZ (January 25, 2001)

CPMs Are Falling Down, Falling Down, Falling Down.
ClickZ (January 23, 2001)

A Good CPM
ClickZ (November 3, 2000)

Watered Down CPMs
ClickZ (December 23, 1999)

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