What is...

Cost per thousand impressions (CPM)

The cost per thousand impressions (CPM, cost per mille) is the total amount an advertiser pays for 1,000 impressions on their page. A CPM of $4, for example, means that you pay $4 for every 1,000 views of your advertisement.

Although CPM is one of the most common pricing models for web ads, it is not a metric that indicates the effectiveness of a campaign. So instead of measuring the number of impressions generated by their ads, for a given budget, advertisers often prefer to focus on more relevant metrics such as the CTR (click-through rate), or the percentage of people who click those ads after viewing them.

When planning the budget of a campaign, depending on the overall goal, an advertiser can choose to pay per mille impressions (CPM), per click (CPC, cost per click) or per acquisition (CPA, cost per purchase). CPM is preferred for campaigns that aim to increase brand awareness, where CTR is less important.

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