What is CPM?
CPM is the cost of showing your ad a thousand times — "mille" is Latin for thousand. Display, video and social campaigns are usually bought this way, because the advertiser is paying for attention rather than for a visit. It is the standard way to compare the price of reach across very different placements.
Formula
CPM = spend ÷ impressions × 1,000Spend = CPM × impressions ÷ 1,000Impressions = spend ÷ CPM × 1,000
Worked example
A campaign spends 800 and is shown 240,000 times. The CPM is 3.33, which means every single impression cost a third of a cent. If 2,400 people clicked, the CTR is 1% and each click cost 0.33.
How to use the CPM calculator
- Enter your spend and the impressions the platform reported.
- Read the CPM — it updates as you type, so you can try a different budget straight away.
- Add clicks to see whether the cheap reach is actually bringing anyone to your site.
Reading a CPM properly
- A low CPM is only good news if the audience is the right one. Cheap impressions in front of the wrong people cost more in the end than expensive ones in front of buyers.
- Compare CPM between placements, not between platforms with different ad sizes and formats — a full-screen video and a small banner are not the same impression.
- If you are selling ad space, CPM is how you price it: your rate card is just the CPM you can defend.
Frequently asked questions
How do you calculate CPM?
Divide your spend by the number of impressions, then multiply by 1,000. Spending 800 for 240,000 impressions is a CPM of 3.33.
What does CPM stand for?
Cost per mille — the cost per thousand impressions. An impression is one showing of your ad, whether or not anyone clicked it.
Is a lower CPM always better?
No. A low CPM in front of an audience that will never buy is wasted money. Judge CPM together with click-through rate and what those clicks go on to do.