Cost Per Mille (CPM)
The cost of reaching one thousand impressions.
Formula
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Example
$500 for 250,000 impressions → CPM = $2
How it works
Cost Per Mille (CPM) tells you how much you pay for 1,000 ad impressions, where an impression means one time an ad is displayed. The formula divides total cost by total impressions to find the cost of a single impression, then multiplies by 1,000 to scale that amount up to a standard unit that is easier to compare across campaigns. This works because ad buying often happens in very large numbers, so CPM turns tiny per-view costs into a practical rate.
When to use it
Use CPM when comparing advertising costs across campaigns, platforms, or time periods, especially in display, social media, and video advertising. It is useful whenever you want to know how expensive it is to get your ad seen, regardless of clicks or conversions.
Worked example, step by step
Total cost = $180 Impressions = 60,000 CPM = (Cost ÷ Impressions) × 1000 CPM = ($180 ÷ 60,000) × 1000 CPM = $0.003 × 1000 CPM = $3 So, the CPM is $3 per 1,000 impressions.
Common mistakes to avoid
- Forgetting to multiply by 1000 after dividing cost by impressions
- Using clicks or conversions instead of impressions in the denominator
- Mixing up CPM with CPC or CPA, which measure different advertising costs
Did You Know?
"Mille" is Latin for thousand — CPM is simply the cost per thousand views.
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