We have provided a useful online CPM Calculator below to work out your CPM. It will also help you derive the number of ad impressions and cost you would need to get a specific CPM. Feel free to experiment with different scenarios in order to help you understand this pricing model better.
What is a CPM?
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 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 once more ad impressions have be 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. 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.
The equation for CPM is:
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CPM = (Ad Spend / Ad Impressions) x 1000
Our CPM Calculator:
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