[GTM glossary](/glossary.txt) Cost per mille Marketing # Cost per mille (CPM) In short Cost per mille (CPM) is an advertising pricing metric: the cost of 1,000 impressions. "Mille" is Latin for thousand. The formula is spend divided by impressions, multiplied by 1,000. CPM measures the price of reach, not results. It does not tell you whether anyone clicked or converted, so it is used with other metrics. ## How to calculate CPM Say a team pays 2,000 for 400,000 impressions. CPM is 2,000 divided by 400,000, times 1,000, which equals 5. If another placement costs 12 per thousand but reaches a narrower, better-matched audience, the higher CPM can still be the better buy. --- ## When CPM is the right metric * **Awareness campaigns:** When the goal is to be seen by many target accounts. * **Comparing placements:** To compare the cost of reach across channels or publishers. * **Brand and ABM air cover:** To keep target accounts exposed while sales works them. --- ## What affects CPM * **Audience targeting:** Narrow B2B audiences such as job titles often cost more per thousand. * **Channel and placement:** Platforms and formats price reach differently. * **Competition and season:** More advertisers bidding for the same audience raises prices. * **Ad quality:** Relevant ads can earn better delivery on some platforms. --- ## CPM vs related metrics * **CPC:** Cost per click. Prices attention that leads to a visit. * **CPA:** Cost per acquisition. Prices a defined conversion. * **Effective CPM:** Total cost per thousand impressions across pricing models, for comparing results. --- ## Common mistakes * **Chasing the lowest CPM:** Cheap reach to the wrong people wastes budget. * **Using it alone:** Pair CPM with click, conversion, and pipeline data. * **Ignoring frequency:** Showing the same person an ad too often has diminishing returns. --- ## Cost per mille FAQs **What is cost per mille (CPM)?** Cost per mille is the price an advertiser pays for 1,000 ad impressions. It is a standard way to buy and compare reach, and it is calculated as spend divided by impressions, multiplied by 1,000. **How do you calculate CPM?** Divide total ad spend by total impressions and multiply by 1,000. For example, 2,000 spent for 400,000 impressions gives a CPM of 5. The figure tells you the price of reach, not the number of clicks or conversions. **Why is B2B CPM often higher?** B2B campaigns often target narrow audiences defined by job title, industry, or company size. Smaller, more specific audiences usually cost more per thousand impressions because fewer people match and more advertisers compete for them. **Is a lower CPM always better?** No. A low CPM can mean cheap reach to people who will never buy. Judge campaigns on downstream results such as clicks, conversions, and pipeline, and use CPM mainly to compare the cost of reaching a given audience. Share term --- ## More related phrases * [Brand](/glossary/brand.txt) * [Brand salience](/glossary/brand-salience.txt) * [Cost per lead](/glossary/cost-per-lead.txt) ## Similar phrases * [Return on ad spend (ROAS)](/glossary/return-on-ad-spend.txt) Return on ad spend (ROAS) measures the revenue earned for every dollar spent on advertising, calculated by dividing ad-attributed revenue by ad cost. * [Brand awareness](/glossary/brand-awareness.txt) Brand awareness is how familiar your target market is with your company, and it shapes whether buyers consider you when a need arises. * [Pay per click (PPC)](/glossary/pay-per-click.txt) Pay per click (PPC) is an advertising model where you pay a fee each time someone clicks your ad, used mainly in search and social campaigns to drive targeted traffic. * [Cost per acquisition (CPA)](/glossary/cost-per-acquisition.txt) Cost per acquisition (CPA) is the average cost to get one defined conversion, such as a customer, trial, or sale, calculated by dividing campaign spend by conversions. * [Revenue per click (RPC)](/glossary/revenue-per-click.txt) Revenue per click (RPC) is the average revenue generated by each ad click, calculated as total attributed revenue divided by clicks, and used to judge keyword and campaign value.