Cost Per Thousand (CPM)

CPM stands for cost per thousand Impressions (the M is the Roman numeral abbreviation for 1,000.) CPM is one of the most common ways to buy digital media. You essentially pay for every time your ad loads on a page or in an app.

It’s a simple way to buy online ads, but it’s coming under increasing scrutiny because the client is charged for the impression whether or not a consumer actually sees it. If, for example, the ad appears below the browser window and the user never scrolls down, the advertiser still pays.

Using the above metrics:

Cost to an advertiser = 5 x (200,000 / 1,000) = 1,000

So, $1,000 is what the advertiser has to pay.

When CPM needs to be calculated, use the final cost.