CPM – Cost per Mille

Definition

CPM (Cost per Mille, Latin for "thousand") refers to the cost an advertiser pays for 1,000 impressions of their ad. This model is the standard billing method for display advertising, video ads, and social media campaigns with reach objectives. CPM provides insight into the efficiency of reach generation.

Formula

Example

A display campaign costs €300 and achieves 150,000 impressions. The CPM is (300 / 150,000) × 1,000 = €2.00. On social media, CPMs typically range from €3 to €12 depending on audience and placement.

Optimization Tips

Optimize your audience segmentation to minimize waste. Test different ad formats and placements. Use frequency capping to avoid excessive repetition. A/B testing creatives can lower CPM through higher relevance.