What is CPM?
CPM, or cost per mille, is a pricing model for advertisers, referring to the amount advertisers pay to display 1,000 ad impressions. It's calculated as (total campaign cost ÷ impressions) × 1,000. The “M” stands for ‘mille,’ Latin for 1,000.
CPM in marketing and advertising
CPM pricing is ideal for brand advertising campaigns, or campaigns that have a goal to increase exposure and brand awareness. That's because, with CPM campaigns, advertisers are buying ad impressions, essentially looking to get more eyes on their ads. Advertisers can run CPM campaigns through Unity Ads.
This is in contrast to performance marketing campaigns and pricing models that require advertisers to pay only when users complete a specific action. For example, in a cost-per-completed-view pricing model, advertisers don't pay until a video ad is watched in its entirety, so simply looking at the ad isn't enough in that case. Similarly, cost-per-engagement advertising requires some kind of action beyond the initial impression, like taking a survey or playing a mini-game.
Because CPM campaigns are so brand oriented, and don't require users to engage with the ad, it's difficult to measure their performance. Still, one common way to determine the efficiency of a CPM campaign is to look at CTR (click-through rate), the ratio of clicks an ad receives compared to overall impressions, which gives a general sense of how well the ad resonated with users.
eCPM vs. CPM
CPM is a pricing model for advertisers, while eCPM is a revenue indicator for app developers. Here's how they compare:
That split shows up in practice, too. Unity's own Ads Reporting dashboard reports eCPM, not CPM, since it's built for developers tracking their own ad revenue, not advertisers tracking their own spend. Nexters saw this firsthand, boosting eCPM 50% and revenue 40% by A/B testing their offerwall.
CPM formula: How do you calculate CPM?
Calculating CPM requires some basic data on an app's ad campaign: the total cost of the campaign, and the number of impressions it received.
Divide the total cost by the number of impressions, then multiply the result by 1,000 to get the CPM figure, also known as the CPM rate.
CPM calculation example
If a campaign costs $300 total and receives 5,000 impressions, the CPM is $60.
($300 / 5,000 impressions) x 1,000 = $60
Frequently asked questions (FAQ)
What's considered a good CPM rate?
It varies widely by platform, ad format, and audience. A useful benchmark is comparing your own CPM over time and against similar campaigns, rather than a fixed industry target.
Does a low CPM mean an ad campaign is performing well?
Not by itself. CPM measures cost per impression, not engagement or results. A campaign can have a low CPM and still perform poorly if those impressions don't lead to real audience interest.
Is CPM the same as CPC (cost per click)?
No. CPM charges for impressions regardless of clicks; CPC charges only when someone actually clicks the ad. They suit different goals, CPM for reach and brand awareness, CPC for driving traffic or action.