What is CPM (Cost Per Mille/Thousand Impressions)?

Understanding CPM

Higher‑intent audiences and premium placements cost more, especially in peak seasons. Strong creative that earns higher engagement can access better inventory efficiently. Aspect‑ratio coverage (1:1, 4:5, 9:16) widens eligible auctions and can stabilize CPM. Audience breadth paired with clear creative often lowers costs without sacrificing results. Monitor CPM by placement, audience, and season to plan ramps.

CPM movements alone don’t define success. Rising CPM with improving CTR/CVR can still be efficient if value per impression climbs faster. Cheap CPM with weak engagement often hides waste. Align creative and feed quality to maintain perceived relevance. Prepare for known spikes (BFCM) by warming accounts and building creative suites in advance.

Why CPM (Cost Per Mille) matters

CPM matters because it determines how much reach your budget can buy and serves as an early signal of competitive pressure or inventory constraints. Seasonal CPM spikes during high-demand periods like BFCM require advance planning and creative preparation to maintain efficient delivery. Monitoring CPM trends helps diagnose whether rising costs reflect stronger competition, creative fatigue, or tightening audience definitions that limit available inventory.

• Budgeting: Determines how much reach your spend buys
• Planning: Seasonal CPM spikes (e.g., BFCM) need prep
• Signal: Rising CPMs can indicate stiffer competition

How to Calculate CPM

• Formula: CPM = (Ad Spend ÷ Impressions) × 1,000
• Compare CPMs by placement and audience, not just campaigns.

Key Takeaways

• CPM (cost per thousand impressions) is (ad spend ÷ impressions) × 1000; it measures reach efficiency.
• Lower CPM by improving ad relevance, targeting precision, and creative engagement.
• Monitor CPM alongside CTR and conversion metrics to ensure impressions drive results.
• Track CPM by placement, audience, and time period to identify cost-efficient inventory.