Marketing Glossary

Cost Per Mille Advertising (CPM)

What is Cost per mile advertising (CPM)?

One thousand people are a “mille” in Latin. In advertising, 1,000 viewers of an ad are called a “cost per mille” or CPM.

Marketing teams typically use this method to measure and compare the costs of different marketing campaigns for the same product.

Internet marketing becomes a cost per thousand impressions (CPM) tool when it comes to ads. A new ad campaign’s success is calculated by dividing the cost of the ad by 1,000 impressions. This number represents the CPM for each impression which needs to be made in order for an ad to be successful.

Comparison can be made more accurate with standardization.

Publishers use CPM to determine when or how often they should place an advertisement. Ad networks are the middleman between advertisers and publishers that can provide connections for ad pricing and placement.

These networks broker a deal so that advertisers will earn anywhere from one penny to ten cents per 1000 impressions (CPM).

How to use CPM to optimize your campaigns?

For example, you run two adds and after a week of testing, you can determine which one has gotten more clicks for less money. It is a clear winner and you run it instead of the other.

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