CPM stands for Cost Per Mille (where "mille" is the Latin word for a thousand).
Definition of CPM (Cost Per Mille / Cost Per Thousand Impressions)
CPM is a fundamental metric and billing model in advertising:
- Billing Model – An online advertising payment system where the advertiser pays a predetermined rate for every 1,000 displays (known as impressions) of their ad, regardless of whether a user clicks on it.
- Performance Metric (KPI) – A metric used to measure and compare the cost of reaching 1,000 people across various advertising channels (e.g., display ads, video ads, or traditional media).
The CPM model is traditionally used in campaigns where the primary goal is brand awareness and achieving the widest possible reach.
CPM Formula:
CPM is calculated by dividing the total campaign cost by the total number of impressions, then multiplying the result by 1,000:
Example: If you spent 500 PLN on a campaign that generated 100,000 impressions, the CPM is 5 PLN. In this case, the advertiser paid 5 PLN for every 1,000 times the ad was displayed.
vCPM (Viewable CPM)
In modern advertising systems (such as Google Ads), vCPM (Viewable Cost Per Mille) is often used. In this model, you are only charged for impressions that are considered "viewable" (e.g., at least 50% of the ad's area was visible on the user's screen for at least one second).
