Although the media have changed, advertising has been around for centuries. From the ads for vintage tonics and powders to interactive ads on the Internet for travel and insurance, the goal remains the same: locate the name of a company facing consumers. Despite technological changes, pricing models of advertising have remained similar.The CPM (cost per ( thousand ) impressions) is an example.
Definition of CPM (cost per ( thousand ) impressions)
CPM, is a model of advertising prices, is synonymous with “cost per thousand impressions.” So, why the “M” and not a “T”? The acronym originally meant “cost per thousand;” thousand is the Latin word for thousand and “thousands” in English, where the term originally comes. If you are a homeowner, a thousand may also sound familiar, because it is also a term used by municipalities to calculate rates of local taxes.
How the CPM (cost per ( thousand ) impressions)
CPM has been used in traditional marketing for decades. The cost of an ad is determined by the approximate impressions or views the ad receives. More simply, an impression is when someone sees the ad.
For example, a front-page ad in a newspaper with a circulation of 10,000 could receive 20,000 impressions as newspapers often shared. In newspapers, circulation figures are used to determine the cost of advertising, while television viewers are and radio, listeners. When online advertising began, the CPM was a perfect formula, image ads could be based on the number of visits to a page price.
Price CPM advertising online
In the CPM pricing model, it sets a price per thousand impressions. Therefore, if an online billboard is set at US $ 10 per CPM and the website receives 10,000 visits, the total cost to the advertiser is $ 100. Individual advertisers create their own CPM price points, which vary from one industry to another. Unlike traditional media, where prices are set based on the estimated reach in internet marketing, the total cost of advertising can tabulate the actual data collected from website analytics.
CPM to CPC
The CPM was more popular for online advertising. In mid-2000, the trend began to move towards a model of performance or cost per click (CPC). This trend coincides with the entry of Google in selling online ads. CPC is based on real conversion, which means that the user has clicked on the ad. This direct answer is easier to measure to meet your return on investment (ROI, for its acronym in English) that prints only. However, the material can be an important part of an advertising strategy if your company is looking for visibility.
CPM advertising examples
Google AdWords is one of the leading advertising platforms for Internet bookmarks. While the CPC model is widely used in this platform, marketers can also choose the CPM model. In AdWords, users choose to bid manually, choosing your own maximum bid rather than using the automated process of Google, for impressions by setting a maximum bid per 1,000 impressions. Facebook ads also allow merchants to choose between CPC and CPM. Affiliate programs marketing or Internet marketing programs that allow web sites to advertise products of a company by a commission on their own websites, CPM also used to reward affiliates of the impressions gained. Finally, independent websites such as blogs, magazines and newspapers, will sell advertising space based on CPM. Local newspapers, for example, can deliver ads to local businesses based on the number of impressions the ad receives.