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What is CPM

What is CPM



What is CPM: A Complete Guide


What is a CPM?

A common CPM definition falls below:


CPM is a commonly used measurement within online advertising as well as radio, television, and print media meaning “cost per mille” or “cost per thousand.” 


In other words, the CPM definition is how much money a publisher makes off of posting 1000 advertisements for a certain amount of viewers. 


What is a CPM Calculation?

A common calculation for CPM includes the following:


1.       Total Cost of Running the Advertisement: $10,000

2.       The estimated amount of viewers: 1,500,000


What is CPM total: ($10,000 / 1,500,000) X 1000= $6.67 per thousand views


What is CPM Standard Formatting?

The Interactive Advertising Bureau is mainly responsible for establishing the CPM definition for advertisement formats and more.  The IAB is made up of more than 500 media and technology companies that sell about 86% of all online advertising in the United States.  The IAB recommends standards and practices for interactive advertising, and the Bureau is headquartered in New York City and has an office in Washington, D.C.


What is CPM Advertising and how does it compare to CPC (Cost per Click) Advertising?

Another CPM definition includes a pricing model that charges advertiser for impressions (the number of time people view the advertisement).  The main problem with the CPM definition is that advertisers are charged even if the target audience fails to click on the advertisement.


CPC advertising is sometimes preferred by advertisers because the advertiser is only charged with the consumer clicks on the advertisement.  The only problem with CPC advertising is that keywords used in such advertising have become extremely expensive to bid on—especially in the legal field. You’ve likely seen legal advertisements on a search engine after searching for a legal term or service.  The CPC ads that appear on the first results page are extremely expensive and can make up a large percentage of the firm’s advertising budget.


What is a CPM Targeted Campaign?

A targeted CPM is somewhat of a new CPM definition.  More and more websites have turned to what is a CPM target campaign instead of a simple banner advertisement.  A targeted CPM model includes the following:


·         gives the advertiser the option to include a small graphic or logo in the text

·         unlike PPC ads, a targeted CPM format allows for only a few ads on a page to increase visibility

·         the CPM advertising model still works on keywords

·         impressions, clickthroughs and even conversions are tracked with CPM

·         a CPM advertisement can often be changed


What is CPM Pricing History?

According to a CPM definition for pricing from MediaLife Magazine in 1998 to 1999, the rates dropped from $45 to $39.  In just two years, MediaPost provided a CPM definition for the price of banner ads, which had dropped as far as $5. Although the prices for what is a CPM advertisement have dropped significantly in just over 10 years, some CPMs remain fairly high for highly targeted websites. 


What is CPM Preferable Formatting?

According to the IAD, the total amount of revenue from ad formatting in 2011 totaled $31.7 billion.  The most common types of ad formats include the following, and the most common is listed at the top:


·         search 47%

·         display/banner 22%

·         classifieds 8%

·         digital video 6%

·         lead generation 5%

·         mobile 5%

·         rich media 4%

·         sponsorship 4%

·         email 1%


What is CPM Advertising?

Several different types of advertisements and the CPM definition are provided below:


What is a CPM Display?

This CPM definition includes  an advertiser that pays a legal website for a space to display a static, hyperlinked, or logo ad on one or more of the pages.


What is CPM Sponsorship?

This CPM definition includes custom content for the advertiser which may or may not include different elements of advertising.  Spotlight sponsorship may include a custom built page; advergaming may include buying slots around a game; content & section may include a particular section of the website or email; sweepstakes & contests may include a branded contest with submissions and more.


What is CPM Emailing?

The email CPM definition may include banner ads, links, email marketing campaigns, or other types of email communications.


What is a CPM Search Ad?

A CPM definition for a Search ad includes several different types of lists or links that the advertiser pays firms to link their ad to certain domain names or specific search words.  The different types are explained below:


1.       paid listings- test appears at the top or side of search results

2.       contextual search- text appears in the article based on the content of the article

3.       paid inclusion- listing is determined by search algorithms

4.       site optimization- modifies a site to allow search engine to automatically index the site



What is CPM Rich Media?

A good CPM definition for this type of advertisement includes advertisements that allow for animation and/or interactivity.  This advertisement can also occur on a banner, button, or an interstitial.


What is a CPM Digital Commercial?

The CPM definition for this type of advertisement includes a TV-like advertisement that appears as an in-page video commercial before, during, or after a certain amount of content is obtained by the viewer.  The direct form as to what is a CPM digital is abstract and may include live, archived or downloadable content.


What is CPM Mobile Advertising?

The CPM definition for mobile advertising is when the content is adjusted and delivered through a mobile device such as a smart phone or a tablet.  A CPM advertisement over a mobile device will usually take the form of a mobile website, mobile app, or text message. 


What is CPM: Conclusion

The  question to what is a CPM advertisement is complicated, and prices for different kinds of a CPM definition can greatly vary.  Most of the major providers for online advertising like Google and Yahoo operate under PPC advertising (pay per click), but CPM is still a popular option for certain kinds of advertising.