Cost per impression (CPM) phrase used in online marketing and advertising related to web traffic. This technique is useful in measuring cost of a specific e-marketing campaign. It is applied with web banners, e-mail spam, text links and opt-in email advertising.

CPM model refers to advertising bought on the basis of impression. This is as compare to the number of types of pay-for-performance advertising, whereas payment is only triggered by a mutually agreed upon activity like click-through, registration, sale.

In a CPM deal, the total price paid is calculated by multiplying the CPM rate by the number of CPM units.

CPM’s price = CPM rate * No. of CPM units

Cost Per thousand impressions is method of pricing web banner ads which is an effective method. It is the cost for displaying a banner 1000 times.

You can reach potential customers on the Web by using CPM (cost per thousand impressions) advertising. You purchase a set amount of impressions a single instance of an ad appearing on a Web site) instead of paying per click in a CPM technique. This advertising can be a cost-effective as compare to CPC deals. To describe this point, we just compare the overall expense of both techniques.

In CPC based advertising, you pay for each click which your ad receives. If you are spending $1 for each click then 10 clicks costs you $10. In CPM based campaign, you pay $3 for 1,000 impressions. If your ad receives a click-through ratio of just 1 percent, then 10 clicks costs you $3.

Currently, it has shown that text-based CPM ads receive more attention than traditional banner ads. A graphical ad only averaged 1.6 seconds while the average view time for a text based ad averaged 7 seconds. Text CPM ads are more popular and may be alternative to CPC-based advertising. So, if your desired keywords are very expensive and popular then CPM based advertising can be more suited for your company. It can add up over time.

Click Through ratios for CPM based advertising are low, these are not everything. Even in promoting your company a viewed but unclicked ad can also play an important role. Even if the viewer doesn’t click then also a well designed ad will catch a viewer’s eye and can promote brand recognition.

Now, we hope you have got the answer that whether this technique is important as compare to other techniques.

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