What does CPM mean in marketing terminology?


CPM stands for Cost Per Mille, or Cost Per Impression, and is a measure of the cost of advertising on a certain channel or platform. It is a metric used in online marketing, as it refers to how much it costs for an advertiser to reach a thousand people.The CPM is calculated by dividing the cost of the advertising by the number of impressions (the number of unique instances in which the advertisement is displayed).

When setting up a digital advertising campaign, the goal is usually to reach an audience with a specific message. This is usually done through a combination of various tactics, such as search engine optimisation, social media marketing, content marketing and other forms of digital marketing strategy.

When calculating the cost of advertising, it’s important to understand the CPM and how it works. It’s the most useful metric when comparing different digital marketing strategies and selecting an advertising channel for a specific campaign.

The CPM will generally be different for each channel, even for the same audience. For example, one channel might offer a lower CPM, meaning that it is more cost-effective in terms of reaching the desired audience; while another will have a higher CPM, meaning that it will be more expensive to reach the same group of people.

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It’s important to understand the context in which the CPM is being used. For instance, web banners and display ads have a higher CPM due to the large amount of overhead costs associated with them. On the other hand, content marketing, email marketing, and social media marketing have lower CPMs since they do not require as much overhead.

The best practice for calculating the CPM for a specific campaign is to compare the costs of different digital marketing channels and measure the return on investment (ROI) for each. This involves tracking the number of leads and conversions generated from each channel and calculating the cost per lead or sale. This information can then be used to find the most effective and cost-effective digital marketing channels.

The general guideline for CPM calculation is to consider the long-term goals of the campaign rather than the short-term costs. For example, the CPM of a website may be a bit higher than the CPM of a social media post, but if the website is able to generate leads and leads to sales, the higher CPM can be justified.

CPM is a useful metric to assess the cost-effectiveness of different digital marketing channels. Consideration should also be given to the audience and objectives of a campaign as well as the long-term goals of the campaign, in order to ensure that the correct channel is chosen for an advertising campaign and the right CPM is calculated.