By krbaker@hubspot.com (Kristen Baker)

As an advertiser and marketer, it’s important to understand the impact of your campaigns and content on your target audience.

It’s also important to know how much money you need to invest to ensure those campaigns and content are actually seen by your audience.

You may have heard of CPM before — it’s a formula and metric that tells you exactly that.

In this article, we’ll review what CPM is, how to calculate it, and tips on how you can get the best CPM.

CPM Meaning

CPM in marketing is cost per thousand, also known as cost per thousand impressions or cost per mile. It’s a formula that calculates the total ad spend per 1,000 impressions on a web page.

How does CPM work?

CPM is often used in advertising, marketing campaigns, social media, and digital marketing. It tells you the total ad spend for every 1,000 impressions. An impression in CPM is how many views/ engagements an ad receives — it’s when an ad is successfully displayed to a visitor or audience member on a web page.

Impressions are small units of measure in marketing which is why they’re calculated by the 1,000 — this gives advertisers and marketers a better idea of the impact their work is having on audience members.

CPM is an effective top-of-funnel strategy because it helps advertisers garner a lot of attention from a large audience on one piece of content, all on a pre-determined budget.

As a result, you’ll increase brand awareness and recognition as well as develop an understanding of which ads and content types are most successful among your audience so you can improve upon

CPM Advertising

Advertisers often use CPM. They select an ad publisher to work with based on where they want their ads published and the specific audience they want to get those ads in front of. Then, advertisers pay the ad publisher, often $1-$10+, for every 1,000 ads that are displayed to viewers.

This method of advertising allows advertisers to stick to a set budget while ensuring their target audience is seeing their ads and campaigns on a large scale. Especially when used on mobile — CPM ads are an effective way for advertisers to determine the impact of their in-app ads.

How to Calculate CPM

To calculate CPM, you need to use the following formula which states CPM is equal to the total amount spent/ total ad spend divided by total impressions multiplied by 1,000.

CPM Formula

How to Get the Best CPM

There are a number of tips and techniques you can apply to help you get the best CPM possible — here are some examples.

1. Choose an ad network.

There are several networks and publishers available for your CPM ads. Here are five popular options:

• Google AdSense: Video ads, mobile ads, display ads, text, in-feed ads, in-article ads, matched content ads, games ads
• Criteo: Digital ads, …read more

  Source:: HubSpot Blog

        

  

  Author: Aaron