In digital marketing , CPM refers to the amount an advertiser pays for 1,000 impressions of an ad on a web page. The important thing here is to understand what an impression means . An impression means that the ad, as an element of a web page, has loaded and received one view. It is not the same as a page view.
When you choose CPM as your payment method, the advertiser agrees to pay the ad publisher a pre-determined amount for every thousand impressions. This means the publisher is compensated dental email list for each ad shown, giving them more predictable profits.
However, to be viewed by a thousand people, the advertiser's website must have a lot of traffic, so this type of campaign pricing is most commonly used by news portals or well-known blogs. CPM is used in branding campaigns , for example, which aim to increase brand awareness of a company or product. It is also a strategy recommended for medium and large companies that have a well-structured marketing area and a clear strategy.
The CPM formula in marketing is as follows:
CPM = Total Cost / (Views / 1000)
For example, if an advertiser makes the following agreement with the publisher:
1) 10,000 ad impressions in a medium rectangle format, with dimensions of 300 x 250, with a CPM of R$5
2) 10,000 impressions of ads in header format, with dimensions of 728 x 90, with a CPM of R$7
The total cost of item 1 is 50 reais, because:
This way, the advertiser would spend R$120 on ads: R$5 for every thousand impressions of the medium rectangle (totaling R$50) and R$7 for every thousand impressions of the header (totaling R$70).
READ MORE: CAC: what is Customer Acquisition Cost?
CPM vs CPA vs CPC: What are the differences?
CPC , or Cost Per Click, is very different from CPM. To give you an idea, while one is concerned with charging based on impressions, the other uses the user's click on the ad as a charging factor. Thus, the advertiser pays for visitors who go from the publisher's website to their own website through a click on the ad.