Cost Per Mille (CPM)

Definition of Cost Per Mille (CPM)

A pricing model where advertisers pay per one thousand impressions of their ad.

Explanation of Cost Per Mille (CPM)

Cost Per Mille (CPM) is a pricing model used in digital advertising where advertisers pay for every thousand impressions of their ad. This metric is commonly used in display and video advertising to measure the cost of reaching a large audience. For example, if an advertiser spends $500 and the ad is shown 100,000 times, the CPM is $5. CPM helps advertisers understand the cost of reaching their target audience and allows for comparison across different campaigns and platforms. It is an essential metric for brand awareness campaigns where the goal is to maximize visibility rather than immediate conversions. By monitoring CPM, advertisers can optimize their budget allocation and improve the efficiency of their marketing efforts.

This dictionary entry was written by

Per-Gulbrand Peter Braathen

With a foundation in doctoral-level research, Per-Gulbrand Peter Braathen is a seasoned expert in the areas of marketing, branding and communication. His proficiency extends to marketing management, branding and communication strategy. Braathen's experience is underscored by his rich background from various industries, including entertainment. A distinguished alumnus of the USC Marshall School of Business, Braathen boasts a Master of Science in Marketing, complemented by a Graduate Certificate in the Business of Entertainment from the USC School of Cinematic Arts as well as two undergraduate Bachelor degrees from the esteemed University of Southern California.