What is CPM?

CPMstands forcost per mille,or the cost per thousand impressions of an advertisement.CPM is a payment model in online advertising where you pay for the number of times your ad is shown, and not per click.The model is mainly used for campaigns aimed at reach and brand awareness, where visibility is more important than a direct click or conversion.What exactly does CPM mean?The abbreviation comes from the Latin

mille, meaning thousand.With

this model you charge per thousand impressions, also called impressions.If an advertiser uses a CPMof 5euros, he will pay 5 euros every time his advertisement is shown a thousand times.This makes it one of the oldest and most used models in display and social advertising.How do you calculate CPM?You calculate it by dividing the total advertising costs by the number of impressions and multiplying by a thousand:CPM = (ad cost / number of impressions) × 1,000An example:

if a campaign costs

500 euros and yields 200,000 impressions, you end up with 2.50 euros per thousand impressions.Conversely, with a known

rate you can also estimate in advance what a desired

reach will cost, which is useful when planning a media budget.When do you use CPM?This model is suitable when your goal is reach and brand awareness instead of direct clicks.Think of social media advertisements, video and display campaigns in which you want to reach as

many relevant people

as possible.If you want traffic or requests, a per-click payment model often makes more sense.Within Google AdsSocial media advertisingand CPACPM, CPC and CPA are different payment models.With CPM you pay per thousand impressions, with CPC (cost per click) per click and with CPA (cost per acquisition) per conversion.Which model is the most beneficial depends on your goal:Outsource Google Adstraffic or concrete results.In practice, they are

often used side by

side within one strategy.You can find more information about advertising models in the Google Ads Help.Why is CPM important?The CPM makes the costs of visibility measurable and comparable.By comparing the rates of different channels, target groups and advertisements, you can see where you can purchase relevant reach cheapest.This way you manage your media budget more efficientlyand avoid payingtoo much for impressions that yield little.What is the difference between CPM

and CPC?With CPM you pay per thousand impressions, regardless of whether there are clicks.With CPC

you only pay when someone actually clicks.CPM corresponds to reach and awareness, CPC to direct traffic and conversion.Is a low CPM always better?Not necessarily.A low rate means cheap impressions, but says nothing about quality.A slightly higher price with a sharply targeted audience often yields more than many cheap,

irrelevant impressions.What is an

average CPM?This varies greatly by platform, target group and period.On social media it is often between a few euros and tens of euros per thousand impressions.Therefore, always compare within the

same channel and the same

target group.