Cost-per-thousand impression (CPM) or cost per mile, represents the total amount an advertiser pays for 1,000 impressions on their page. If a publisher charges $4.00 CPM, then the advertiser must pay $4 for every 1,000 clicks of the ad.
CPM vs. CPA vs. CPC
Cost per mile (CPM) is one of the most used pricing models for online advertisement. There are other popular models such as cost-per-click (CPC) and cost-per-acquisition (CPA). In CPC, the site owner pays every time a user clicks on an ad while in CPA, the advertiser pays only when the visitor makes a purchase.
If your campaign focus is directed to a niche audience making a purchase, cost-per-click (CPC) or cost-per-acquisition (CPA) are more convenient price models for your business.
Cost per thousand impressions (CPM), on the other hand, is a better method for businesses interested in creating or boosting brand awareness or expanding, promoting a new product, or for those products with already large markets.
CPM is also used by people who want to develop or already have mobile apps. In this case, a couple of factors need to be considered before making any decision.
Anything from a banner ad to a pop up is considered an impression. Imagine all the times you are on your phone playing a game or using an app, and an ad appears, or there is one at the top or bottom of the screen. All these advertisements add up as impressions and will be counted for the CPM calculation.
It’s important to note that you shouldn’t expect to see the revenue right away. This process can be slow, and the results can be best appreciated in the long run.