Use this CPM Calculator to calculate the CPM of your campaigns.
CPM is the price per 1,000 impressions. Our Cost Per Thousand calculator will also help you work out the number of ad impressions or the cost you would need to hit a specific CPM.
Feel free to experiment with different scenarios in order to help you understand this ad pricing model better.
The equation for CPM is:
CPM = (Ad Spend ÷ Ad Impressions) × 1000
What is a CPM?
CPM stands for Cost Per Thousand Impressions (with M standing for mille – which is French for 1,000 ). It is one of the most common ad pricing models.
The minimum level to start being able to judge the success of an ad campaign is 1,000 impressions. This is because, at lower levels of exposure, random events can skew results.
For example, clicks can occur by accident on a single ad. Or else a single very interested user can generate 100 ads in a day but is still likely to click on only one from any advertiser.
Therefore performance can be better measured after more ad impressions have been seen, and this randomness has been weeded out. This is what makes 1,000 ads a sort of basic unit in online advertising.
In most cases, a CPM advertising deal is the best type of deal a website can get. This is because the website will still get paid regardless of how well an ad campaign performs.
However, this does not mean the publisher should get lazy! Optimising ads towards clicks (at the very least) always makes sense, as it will help gain repeat business.
A CPM deal can also be great for advertisers who are simply looking to spread their message far and wide. As long as an ad buyer is willing to accept restrictions, they can often buy ads at a very cheap CPM.
For example, buying ads on a ‘blind’ basis (where the buyer doesn’t know which exact sites the ads will go on). This can still be a relatively risk-free proposition, as even blind ad networks will make promises as to the type of site they use.
Find out more
- CPM Definition
- CPM Advice for Website Owners
- CPM Advice for Ad Buyers
- CPC vs CPM Tested (work out when to switch)
- Impression Definition
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