What is Cost Per Mille (CPM)?
A pricing model where advertisers pay a specific price per thousand impressions for ads served on a publisher's app.
Cost per mille (CPM) – or cost per thousand impressions – is a metric and pricing model used in the mobile adtech market. With a CPM pricing model, app advertisers are charged a specific price per thousand impressions for ads served on a publisher's app. It's the most common pricing model in the industry and is especially used for programmatic advertising.
Why It Matters
From an advertiser's perspective, they can estimate the cost of an ad campaign and its reach to keep within their budget. Publishers can generate revenue each time an ad is served in their app without requiring user interaction. CPM campaigns focus on impressions rather than clicks or installs, which benefits publishers.
How to Calculate
CPM = (Ad Spend ÷ Ad Impressions) × 1,000. For example, if an advertiser pays $1,700 to serve ads that receive 500,000 impressions, the CPM would be $3.40.
Industry Benchmarks
CPM varies from platform to platform, GEO to GEO, and timing of ad serving. Trends and seasonality play a large part in fluctuating CPMs. Compare results with averages within your own vertical and consider ROAS to determine if the CPM is effective.
Best Practices
Focus on quality over low CPM to avoid poor-quality traffic. Monitor brand safety and ad placement quality. Use CPM for awareness campaigns while tracking related metrics like eCPM for publishers. Balance CPM goals with overall campaign performance.
Examples
A puzzle game advertiser runs awareness campaigns across multiple publishers. They track CPM performance by geography: US ($4.50), UK ($3.20), Germany ($2.80), helping them optimize budget allocation across markets.
Notes
Unlike CPI campaigns, CPM campaigns don't require user interaction - just ad views. This makes CPM less risky for publishers but potentially less targeted for advertisers. Closely related to eCPM, which calculates publisher revenue per 1,000 impressions.