CPM Advertising Payment Model


CPM is the cost per 1000 impressions of web advertising (from the English term Cost-Per-Mille). The popular CPM model involves paying for the display of an ad to thousands of users.

What is CPM in advertising? The scheme was borrowed from the media. CPM calculation is necessary when planning media campaigns and analyzing audience reach. It is calculated by the formula: CPM = advertising publication price / number of potential contacts * 1000. If the publication price of the block is $ 100,000 per month, and during this time 10,000 people visit the site. This means that the CPM of an advertising resource is: 100,000 / 10,000 * 1000 = $ 10 per 1000 impressions.

CPM characterizes the profitability of a web page. With its help, the amount received for conversions from 1000 impressions is determined. This indicator should not be confused with CTR, which determines not quantitative, but qualitative indicators of resource profitability. CPM is needed when calculating the exact amount of revenue based on the price of one click.