CPM stands for cost per mille, with mille meaning one thousand. It is what you pay for 1,000 impressions of an ad. The formula: total spend divided by impressions, multiplied by 1,000. Spend $50 for 10,000 impressions and your CPM is $5.
CPM is the go-to metric for awareness campaigns, where the goal is to get seen rather than clicked. Prices shift with audience size, competition, season and ad placement, and they often rise during busy shopping periods.
Use CPM to compare how efficiently different audiences or platforms deliver views. Then pair it with click-through rate to see whether those views turn into action.
Questions about CPM
How do you calculate CPM?
Divide total ad spend by total impressions, then multiply by 1,000. If you spent $120 and got 40,000 impressions, your CPM is $3. It shows the price of reaching a thousand screens, regardless of clicks.
Why is my CPM so high?
High CPMs usually come from a narrow or highly competitive audience, a busy season, low ad quality or relevance scores, or premium placements. Broadening targeting, refreshing creative and testing other placements are common ways to bring it down.
What is the difference between CPM and CPC?
CPM is the cost of 1,000 impressions, while CPC is the cost of one click. CPM tells you how expensive it is to be seen. CPC tells you how expensive it is to get someone to act on what they saw.
