Last Updated on by Sabina
In advertising, CPM stands for “Cost Per Mille” or “Cost Per Thousand.” It is a metric used to measure the cost-effectiveness of an advertising campaign and represents the cost an advertiser pays for every one thousand impressions (views) of an advertisement.
The formula to calculate CPM
Is CPM = (Total Cost of Ad Campaign / Total Impressions) x 1000
For example, if an advertiser pays $500 for an ad campaign that generates 100,000 impressions, the CPM would be: CPM = ($500 / 100,000) x 1000 = $5
The CPM metric is often used in digital advertising, where impressions can be tracked more accurately compared to traditional advertising channels like television or print. It helps advertisers evaluate the efficiency of their campaigns and compare the relative costs of reaching a thousand impressions across different platforms or advertising channels.
Regarding the “3 P’s of Marketing,” traditionally, the marketing mix is represented by the 4 P’s: Product, Price, Place, and Promotion. These elements form the basis for marketing strategies and tactics. However, there have been variations and additions to the marketing mix over time. While “CPM” is a common metric in advertising, it is not typically considered one of the core elements of the marketing mix.