Free tool
Calculator

Work out your CPM.

CPM is your cost per 1,000 ad impressions. Use our calculator below to calculate your CPM rate.

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01 / Calculate

Your numbers.

What do you want to work out?
Currency
R

Add a click-through rate to see estimated clicks and your effective cost per click.

%

02 / Results

What the numbers say.

Your CPM

-

At your expected CTR

-estimated clicks
-effective cost per click

03 / The formula

How CPM is calculated

CPM = spend ÷ impressions × 1,000

Example: R10,000 ÷ 250,000 impressions × 1,000 = R40 CPM - four cents per single impression.

If you understand the total cost of your campaign and the number of impressions (every time your ad is served), you can calculate your CPM rate. A low CPM rate isn't always good and a high CPM rate isn't always bad, since CPM is only a reflection of the amount paid per 1,000 impressions.

How to use CPM rates

In my view, CPM rates are useful when you buy similar inventory types in display or programmatic ads and would like to compare the efficiency. If you know, for instance, that the audience quality of two different publications is fairly similar - then having a lower rate could stretch your media budget further.

How to improve CPM

Improve ad quality: a more engaging, targeted and relevant ad will be more effective to its target audience. An increase in CTR has a positive effect on quality score in Google Ads, which can lead to lower CPM rates.

Supply ad variations: more ad creatives and more variations give the automated machine learning algorithms, prevalent in PPC programs, more opportunities to improve relevancy, which assists CPM rates.

Prioritize relevant reach: CPM rates are only half of the equation of effective advertising. It's important that you prioritize reaching your top customers or an audience that will be highly engaged.

04 / Answers

Frequently asked questions.

What is CPM?
CPM stands for cost per mille - the cost of 1,000 ad impressions. If you pay R10,000 for 250,000 impressions, your CPM is R40. It is the standard pricing unit for display, video and social campaigns, where you buy visibility rather than clicks.
What is a good CPM?
There is no universal 'good' CPM rate, however, you can benchmark your own account and placements to see if there are dramatic increases for the same types of inventory. Be careful in simply pausing high CPM programmatic advertising without knowing its contribution towards your business goals.
What is the difference between CPM and CPC?
CPM or cost per thousand impressions is the cost efficiency metric used in display, programmatic or paid social media campaigns. CPC stands for cost per click and is the metric used to understand the amount paid per click on a keyword in search campaigns.
How do I lower my CPM?
Expect to pay higher CPM rates on premium inventory or premium placements. For example: a YouTube Masthead will typically be at a higher CPM than a normal in-stream YouTube ad. Expect CPMs to increase during seasonal events such as Black Friday or Cyber Monday. You can lower your CPM by improving your ad quality, supplying ad variations and pausing display advertisements with high CPM rates in order to lower your average CPM.
Is a lower CPM always better?
No. A low CPM can simply mean low-quality inventory - poor placements, bot-heavy traffic, or audiences with no intent. The number that matters is profit per rand of spend, not cost per thousand views. Treat CPM as a diagnostic, not a target.

05 / Start

Your CPM is half the story.
Effectiveness is the other half.

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