CPM
Cost per mille. The price of one thousand ad impressions.
What is CPM?
CPM stands for cost per mille, from the Latin for thousand, and expresses the cost of delivering one thousand ad impressions. It is the standard pricing unit for display, video, CTV and many other reach-oriented formats. Buyers use it to compare channels on a common basis, and publishers report revenue as eCPM, or effective CPM, to compare sources that pay on clicks or actions. Variants include vCPM, which counts only viewable impressions, and CPCV, cost per completed view, used in video. In programmatic auctions, bids are typically submitted as a CPM value even though each auction is for a single impression.
How CPM works
Media is priced per thousand impressions served, regardless of whether anyone clicks.
- The buyer and seller agree on a CPM or the buyer submits a CPM bid in an auction.
- Impressions are served and counted by the ad server.
- Cost is calculated as impressions divided by 1,000, multiplied by the CPM.
- For other pricing models, revenue divided by impressions and multiplied by 1,000 gives an effective CPM.
Why it matters
It is the common currency for comparing reach-based media. Publishers also use an effective CPM to compare what different demand sources pay.
For advertisers
CPM makes it straightforward to budget for reach and compare the price of audiences across channels.
For publishers
Tracking eCPM by placement, format and demand source shows where inventory earns most and guides floor and yield decisions.
Practical example
A video campaign bought at a CPM of 15 pays 15 for every thousand impressions delivered.
Key considerations
- A low CPM is only good value if impressions are viewable, brand-suitable and reach the right audience.
- Comparing CPMs across formats can mislead, because video and CTV deliver different attention than standard banners.
- Second-price and first-price auctions produce different cleared CPMs for the same bid strategy.
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Frequently asked questions
How is CPM calculated?
Divide total cost by total impressions and multiply by 1,000.
What is eCPM?
Effective CPM is revenue or cost expressed per thousand impressions regardless of how the media was actually priced.
What is vCPM?
Viewable CPM charges only for impressions that meet a viewability standard.