Cost Per Thousand - CPM

Loading the player...

What is a 'Cost Per Thousand - CPM'

The price of 1,000 advertisement impressions on one webpage. If a website publisher charges $2 CPM, that means an advertiser must pay $2 for every 1,000 impressions of its ad. The "M" in CPM represents the roman numeral for 1,000. CPM is the most common method for pricing web ads. However, an advertisement's success cannot be measured by CTR alone, because an ad that is viewed but not clicked on may still have an impact.

BREAKING DOWN 'Cost Per Thousand - CPM'

Website publishers like CPM advertising because they get paid for simply displaying the ads. Other methods of pricing website advertising include cost per click (CPC), where the advertiser pays each time a website visitor actually clicks on the ad, and cost per acquisition (CPA), where the advertiser only pays each time a website visitor makes a purchase that can be directly traced to having clicked on that ad. Different pricing methods will be more appropriate for some ad campaigns than others. CPM makes the most sense for a campaign focused on heightening brand awareness or delivering a specific message.

RELATED TERMS
  1. Traffic Acquisition Cost - TAC

    Payments made by Internet search companies to affiliates and ...
  2. Cost Per Click - CPC

    A website that uses CPCs would bill by the number of times a ...
  3. Impression

    A metric used to quantify the display of an advertisement on ...
  4. Click-Through Rate (CTR)

    The percentage of individuals viewing a web page who click on ...
  5. Banner Advertising

    A rectangular graphic display that stretches across the top or ...
  6. After-Hours Trading - AHT

    Trading after regular trading hours on the major exchanges. The ...
Related Articles
  1. Term

    What Is Cost Per Thousand?

    Cost Per Thousand, or CPM, is a price Internet publishers will charge for every 1,000 advertisement impressions recorded on a webpage.
  2. Markets

    How TheSkimm Works and Makes Money

    Obtain information on the popular news digest newsletter, theSkimm, and understand how email newsletter publishers generate revenues.
  3. Professionals

    Sales Director Career Provides Daily Challenge

    Find out what you need to do to close the deal on this investment management position.
  4. Professionals

    The Marketing Director's Pitch

    Are your shoulder's wide enough to carry a company's reputation?
  5. Entrepreneurship

    10 Breakout Ideas For Small Businesses

    If your business has hit a wall, we've got the answer to break through and increase sales and earnings.
  6. Professionals

    The Lucrative World Of Third-Party Marketing

    Hedge funds don't sell themselves. Marketing experts reel in the big fish.
  7. Retirement

    Generational Marketing: Harvest The Whole Family Tree

    Attract new clients by tailoring your message to specific age groups.
  8. Entrepreneurship

    Small Business: It's All About Relationships

    Rather than be a jack-of-all-trades, an owner should rely on a network of trusted experts.
  9. Economics

    What Sources Of Funding Are Available To Companies?

    Despite all the differences that exist between companies, there are only a few sources of funds that are available to all firms.
  10. Economics

    How Can Companies Increase Market Share?

    Companies that increase their market share enjoy a competitive advantage. They receive better prices from suppliers, and they’re able to produce goods faster.
RELATED FAQS
  1. How do people make money on the videos they upload to YouTube?

    Learn about the primary ways that people can generate income based on the videos they upload to YouTube, including advertising ... Read Answer >>
  2. Is a financial advisor allowed to pay a referral fee?

    Understand how financial advisors can legally pay a referral fee to someone for soliciting business, and learn the regulations ... Read Answer >>
  3. How does a long tail become profitable?

    Understand what the long tail concept is and who pioneered it. Learn how a company using a long tail strategy becomes profitable. Read Answer >>
  4. How do companies with a large product portfolio use BCG Analysis?

    Understand what BCG analysis is, and learn how companies use the BCG Matrix to analyze the performance of their product portfolios. Read Answer >>
  5. What are the similarities between product differentiation and product positioning?

    Learn how two marketing strategies, product differentiation and product positioning, are similar and work together to effectively ... Read Answer >>
  6. What are the major categories of financial risk for a company?

    Examine four major categories of financial risk for a business that represent potential problems that a company may have ... Read Answer >>
Hot Definitions
  1. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  2. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
  3. Generally Accepted Accounting Principles - GAAP

    The common set of accounting principles, standards and procedures that companies use to compile their financial statements. ...
  4. DuPont Analysis

    A method of performance measurement that was started by the DuPont Corporation in the 1920s. With this method, assets are ...
  5. Call Option

    An agreement that gives an investor the right (but not the obligation) to buy a stock, bond, commodity, or other instrument ...
  6. Economies Of Scale

    Economies of scale is the cost advantage that arises with increased output of a product. Economies of scale arise because ...
Trading Center