What is Cost Per Impression (CPM)?
Cost Per Impression (CPM) is a type of pricing model used in online advertising that charges a fee based on the number of times an advertisement is viewed, regardless of the number of clicks or conversions it generates. It is one of the most common pricing models used in online advertising.
How Does CPM Work?
When using the CPM model, advertisers pay for each thousand impressions of their ads. The cost per thousand impressions is determined by a number of factors, such as the size of the audience, the type of advertisement, and the target audience. Advertisers can buy CPM ads on both programmatic and direct-buy platforms. Programmatic buying is a type of automated advertising where ads are purchased through an online auction. Direct-buy buying is when the advertiser pays a fixed rate for a guaranteed number of impressions.
Examples of CPM Advertising
CPM is most often used for display advertising, such as banners and native ads, but it can also be used for other types of online advertising, such as video ads, audio ads, and email campaigns. CPM can also be used for other types of media, such as television and radio, where advertisers pay for a set number of impressions. For example, an advertiser may purchase a spot on a television show that airs 100 times and pay based on the number of people who view the ad.
Benefits of CPM Advertising
The primary benefit of using the CPM model is that it allows advertisers to control their budget and manage their costs. Unlike other pricing models, such as cost-per-click (CPC) or cost-per-action (CPA), advertisers don’t have to pay for each click or conversion, which can be expensive. CPM also provides advertisers with a more accurate way to measure their return on investment (ROI). Since advertisers pay for each impression, they can track their ad performance and determine whether their campaign is achieving their desired results.
Conclusion
Cost Per Impression (CPM) is a useful pricing model that enables advertisers to control their costs and measure their return on investment. It is a popular choice for display advertising, but can also be used for other types of online and offline advertising. For more information on CPM and other pricing models, visit the following links: