Do you know the meaning of CPM? We can help. Read on to discover the scoop on this commonly used abbreviation and how you can use it today!
You may have heard the acronym CPM before, but do you know what it stands for? Don’t worry; we’re here to help. In this post, we’re exploring the term CPM to uncover what the acronym stands for, its meaning, how to use it in a sentence, and more. Are you ready?
Let’s dive in!
What Does CPM Stand For?
As claimed by the fine folks over at Cambridge English Dictionary, the acronym CPM is a marketing term that stands for Cost Per Thousands. Now stay with us here; we agree at face value that doesn’t add up — keep reading, and we will explain everything in detail, promise!
First things first, as we find in many grammatical rules, a word’s origin is to blame when you find things a bit confusing or wonky at times.
The “M” in CPM, you know the one we stated, stands for thousands is represented by the Latin “mille,” which, you guessed it, means thousands.
CPM pricing model, in its essence, is used to denote the price of 1,000 online advertising “impressions” on any one web page. To explain further, if a website publisher decides to charge $2.00 CPM, then in turn, for every thousand impressions of their ad, the advertiser must pay $2.00.
CPM Success and CTRs
Hands down, the most common digital marketing method for the pricing of web ads is CPM. The caveat is that CPM relies implicitly on impressions (often referred to simply as ad views).
In layman’s terms, impressions are a metric that counts the total number of impressions or digital views of an ad. While this may be a great way to measure how many times an ad was displayed, it misses whether the ad was clicked on.
The measurement of whether an ad was seen on a website and clicked on is referred to as a CTR or Click-through rate. Advertisers often measure the success of a Cost Per Mille campaign by its CTR. At the same time, many people argue that ads can impact viewers even if they don’t click through.
Something to note is that the largest disadvantage of using CPM is the system itself, or rather, the counting method. Ads that fail to load, incorrectly counting views due to duplicate views, or advertising fraud all count towards CPM.
CPM vs. the Various Online Pricing Methods
While there may be many, three methods are used above all else used to price website ads, and CPM represents just one. Another pricing model is CPC or cost per click (also commonly referred to as PPC or pay per click).
Just as it sounds, CPC refers to the pricing method, where the advertiser pays each time a website visitor “clicks” the ad in question.
The last of the three most commonly used pricing methods is CPA (defined here as cost per acquisition). This method of pricing refers to when an advertiser only pays each time a website visitor makes a purchase after clicking an ad.
Sure some are better than others, but the chosen price method typically depends on the campaign’s primary target or focus.
For example, CPM makes the most sense if a company has a broad focus and primarily wants to deliver a certain message or raise brand awareness.
In a campaign like this, the exposure from having an ad placed predominantly on a high-traffic website will largely promote a company’s campaign alone, even if the visitors of the page never click the ad itself.
Alternate Meanings of the Acryonm CPM
Now that you understand what CPM means, let’s look at some additional meanings that are often associated with the acronym CPM. Not only will learning these like-words strengthen your understanding of CPM, but it will also strengthen your overall vocabulary, too!
Below you will find various alternate meanings of CPM provided by The Free Dictionary:
- Center for Performance Measurement
- Counts Per Minute
- Commercial Property Manager
- Copies Per Minute
- Control Program for Microcomputers (early 8-bit operating system)
- Chronic Pain Management
- Crisis Prevention and Management
- Church Planting Missionary
- California Pellet Mill Co
- Capability Portfolio Manager
- Career Program Manager (United States Department of Defense)
- Communist Party of India, Marxists
- Customer Profile Management
- Codigo Penal Militar (Portuguese: Military Penal Code; Brazil)
- Combinatorial Pattern Matching
- Certified Public Manager
- Christian Pentecostal Mission
- Child Protection Mediation
- Central Park Media (United States manga/anime publisher)
- Certified Professional Manager
Note to reader: When using the varying definitions of “CPM,” make sure to use proper context to let your peers know what definition you are using. When in doubt, always use the full form of the word!
In conclusion, the acronym CPM is simply a marketing or commerce term for Cost Per Thousands. This refers to the cost an advertiser pays per impression on a web page. CPM is just one of the varying methods used today to price online ads — and always remember a good CPM isn’t based solely on CTRs alone!