What is CPM?
Cost per impression = Advertising cost / 1000 Impressions
It has been our experience that the most common deals are those that are centered around CPM. It is one of if not the most common metric you will see getting thrown around in influencer marketing circles. Its typical use-case varies somewhat depending on the platform so beware. There are more than a dozen considerations to make when calculating a fair CPM price to pay an influencer.
CPM stands for cost per thousand impressions, used to measure how many thousands of people your ad or marketing piece has (hopefully!) affected. The “M” in CPM represents the Latin word “mille,” meaning thousands. CPM is typically used in advertising campaigns designed to reach a very wide group of audience. If a website publisher charges $2.00 CPM, that means a company must pay $2.00 for every 1,000 times its ad is displayed.
Here’s a rundown of how CPM works, when it’s best to use it, and where the money comes from. We’ll also cover how CPM fits in with digital marketing and how it affects your wider company marketing strategy.
How does CPM work?
CPM is a standard marketing metric that measures how much an advertiser pays for 1,000 views of their advertisement. CPM is used most frequently in advertising media selection and the marketing of certain products to online consumers. For example, Google Ads, or Google AdWords, is one of the most effective ways for companies to reach their customers. It works on a CPM or CPC basis.
Impressions are usually measured by thousands in advertising, as they reflect very high awareness of a brand. The best results using this equation come when digital marketers leverage it to create success for other businesses and themselves.
More about CPM deal structures – Influencer Marketing Youtube CPM Guide