Definition of Cost Per Thousand (CPM)

Written by Nick Stamoulis

Cost per thousand, also known as CPM or “cost per mille,” is a model that measures the cost of displaying an advertisement on a web page. Mille is the Latin word for thousand. Cost per thousand is a system that has to do with how many times an advertisement on a web page is viewed. Each time an advertisement is viewed one thousand times, there is a set price range. For example, if the cost per thousand is fifty dollars for an ad, each time it is viewed one thousand times, the advertiser is charged fifty dollars. This type of price measuring for advertising is used online as well as in radio, television, newspapers, and magazines.

What are ad impressions? An ad impression refers to the amount of time your ad has been displayed and shown on a website. With a cost per thousand model you are concerned with the amount of impressions, which differs from CPC (cost-per-click) where the number of clicks on ad is what matters.

Why choose a cost per thousand pricing model? This depends on your goal. With a cost per thousand model, you are looking to get eyes on your ad rather than having people click so they can be sent to a specific website. Cost per thousand works well if you are trying to promote your brand.

What are the benefits of a cost per thousand pricing model? When you’re looking to build your brand, cost per thousand is the perfect model to go with. These campaigns will help to expose your brand to as many eyes as possible and give you the most exposure possible. You can still get clicks with cost per thousand, so you are getting the best of both worlds. The consistency of having your ad seen by as many people as possible will help keep you in the minds of those who see them.

Another benefit to the cost per thousand model pricing is that it is fairly inexpensive. If you have an advertising budget, cost per thousand is the way to go. Plus you can rest assured that the number of impressions made is guaranteed. When your ad appears on a website, you know your target demographic is the audience.

There are cons to the cost per thousand model. The quality of traffic coming across your ad cannot be guaranteed. Your ad can appear on high-traffic websites that are frequented by your target audience, but it’s hard to know how may unique eyes are seeing it or if there are robots accounting for some of the views. Since there is not as much clicking on ads, it’s a bit more difficult to determine who is seeing them. It is more difficult to measure those who take actions when seeing your ad with the cost per thousand model.

That being said, the cost per thousand pricing model can be well-worth it for anyone looking to promote their brand for a good price.

 

Cost Per Thousand (CPM) Definition Sources:

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