All you need to know about the CPM payment model in mobile advertising:

CPM Advertising (cost per mile or CPM payment model)

In the life of all of us there are moments to be faced with these questions: what’s the right decision? Which option should we choose? It is here that we must apply logical and critical analysis and proceed on the basis of the outcome; to find the right path, one can not rely solely on the feeling or the inner self.

In fact, in order to achieve the best possible solution, all the strengths and weaknesses of existing options should be analyzed and all risks should be considered. This need to analyze and understand the path ahead of the business in the business world, and especially marketing, is one of the most basic needs, and it is the same component that separates the path to success from failure.

The optimal use of mobile advertising and online advertising also requires familiarization with various options: multiple models, including CPM, CPC, CPI, or CPA, and even options for how each one is run. Understanding and understanding the underlying aspects of each of these choices will play an important role in your business’s success; therefore, we recommend that you carefully review all your options before proceeding.

In the following, we try to introduce one of the simplest online advertising methods, CPM ads or “cost per visit.”

Learn more about CPM advertising

Model “cost per 1000 visits” or Cost Per Mille is a type of advertising that is often advertised as a banner on media platforms.

For example, if the unit price of a CPM advertising campaign is set at $ 3, it means that the advertiser pays $ 3 for every 1,000 times your ads appear.

Define CPM advertising model or paid per visit

The term cost per visit, or Cost Per Mille, termed CPM, is commonplace in the advertising world. Mille means 1,000 in Latin, French and Italian. So the CPM is simply the cost that a advertiser pays for his / her 1000 ad ad hits.

Radio, TV, newspapers, magazines, environmental advertisements and, of course, online advertising can be priced and purchased based on the ad display for every 1000 people. This term is used in the field of marketing as a benchmark for calculating the relative cost of a promotional campaign or message on a specific media.

In the online world, the CPM payment model is often used for banner advertising and is also referred to as Cost Per Impression.

تبلیغات CPM

CPM Advertising Formula

CPM advertising is calculated by dividing the cost of advertising by the number of hits per advertisement from each 1000 people. This criterion can be used to evaluate the total cost of advertising campaigns to compare the efficiency of different opportunities or media.

The CPM model in media that can not count their hits will reflect every 1,000 “possible hits” of the ad. This traditional benchmark can be used as a complement to core performance models such as cost-per-action models (CPA ads) or app install ads (CPI ads / install ads).

CPM Advertising Model Goals

Generally speaking, in the marketing and advertising world, the goal of the CPM benchmark is to allow comparing the cost of advertising campaigns on one or more advertising media. Each conventional advertising campaign is trying to reach potential customers at different points or on different media. The “cost per visit” criterion helps marketers to compare between different components both at design level and when evaluating campaigns implemented.

Business marketing professionals will be able to measure the success of the campaign in a relative way by dividing the cost of their advertising campaign into the total number of visits and thus the CPM benchmark for their advertising. The division of the number of views into groups of 1,000 has also become standard in this model.

But there are different storytelling campaigns that are named CPM ads based on this costing model. The purpose of this kind of advertising, known as banner advertising, is to create brand awareness and communicate directly with the audience. Even if the respondent does not click on the advert, the ad will be displayed to him and a specific message has been transmitted through the high-profile media. So, in general, you can summarize the goals of a CPM advertising campaign:

  • Increasing brand awareness::
  • CPM ads are ideally suited for newly emerging businesses that are new to the online community and are planning to make cost-effective choices between customers or even potential partners for themselves.
  • Ad for fully relevant audience::
  • Promoting an online business on a highly relevant media can make CPM campaigns more profitable in terms of advertising and marketing.
  • Increasing Conversion Through Productive Campaigns::
  • Putting banner ads at high conversion rates along with the right advertising platform can lead to high efficiency. Choosing the right audience, such as the promotion of a footwear shop on a well-known and specialized footwear blog, can lead to increased effectiveness of the CPM advertising model.

Comprehensive concepts and metrics for CPM ads

CPM advertising campaigns are generally considered for goals that are not intended to lead to a specific action. From this point of view, taking into account performance-based and complementary measures for this type of advertising is not as consistent with its nature. On the other hand, figures for a CPM advertising campaign alone can be misleading, especially for advertisers and advertising networks. As a result, along with the “cost per visit” model, there are other criteria that can be measured by comparing them with CPM, the results of advertising campaigns and their effectiveness for the business. Differences in these criteria with the CPM may seem obvious, but it is vital to understand how these differences and their relationship to businesses are.

CTR

The clickthrough rate (CTR), also referred to as click-through rate, is the number of clicks on the ad, relative to its total number of hits. For example, if an ad is clicked 30 times per 1000 times displayed for the audience, its click or CTR will be 3%. This criterion is considered in addition to the CPM benchmark and is intended to measure the tangible effectiveness of a CPM campaign.

eCPM

One of the important criteria used in conjunction with CPM is Effective Cost Per Mille, called eCPM. eCPM does not make much difference to advertisers who are simply looking to advertise their ads because the end goal of a CPM campaign is the same as the ad display, no more. In fact, eCPM and its comparison with the CPM mean that the cost per click in the targeted ad campaign is specific (ie, click-through or CPC ads). The formula for calculating this criterion is:

eCPM = (CPC x CTR) x 1000

Nevertheless, the story is slightly different from the viewpoint of advertising networks and screenwriters. For example, eCPM allows viewers and ad networks to see which CPA, CPC, or CPM models are more effective and more productive in terms of revenue.

Example: Consider a banner in two locations A and B. Assume that the viewer’s income from assigning these positions to the banner of a CPM campaign is ten dollars a month, that is, $ 5 per 1000 visits or hits $ 0.005. But in the CPC campaign, the viewer can earn $ 1 for each click on each one. Let’s assume that both banners have been displayed for a month and 2000 times have been seen. From the CPM benchmark, almost everything is equal. But from this 2000 equal display, the banner of A’s place has been clicked ten times and the banner of place B has been fifty times. This information shows the eCPM benchmark:

  • The banner of eCPM for A was $ 5: less than $ 10. Therefore, assigning this position and ad to CPM campaigns may have more revenue.                                                                             
  • The benchmark b of eCPM was $ 25, which is $ 10 more. As a result, the CPC (PPC) model will probably be more profitable than the CPM model.

RPM

Revenue Per Mille (RPM) represents the estimate of revenue generated per 1000 times, whether it is used by the advertiser, or by the advertiser. The RPM note does not necessarily indicate the revenue you have earned, but it is obtained by dividing the estimated revenue by the total number of page views, advertising positions, etc., which are multiplied by 1000.

RPM= (estimated earnings / number of impressions) x 1000

Example: If you anticipate that you earn $ 0.15 per 25 impressions per page or ad, then the page’s RPM will be equal to: ($ 0.15 / 25) x 1000, $ 6.

If you anticipate that you earn $ 180 for every 45,000 appearing ads, your ad RPM will be equal to: ($ 180/45000) x 1000 $ 4.

The RPM or revenue per 1000 visits to advertisements and advertising platforms is a standard and widely used benchmark and is used to compare revenue from different channels.

Each of the criteria listed above can be used in conjunction with CPM depending on the different situations.

CPM advertising weaknesses

From the viewer’s point of view, it should be said that if there is not much traffic, the proceeds from this type of advertising will be negligible. Viewers who have a million impressions per month can earn a good return but do not see a million earnings for the show. On the other hand, this type of ad, like other types of ads, can not hold them up if they are not executed correctly, and can result in an inverted result.

Admittedly, CPM ads do not necessarily have a tangible effect on the advertiser based on their browsing nature. As a business or business looking for tangible results and immediate performance such as installing an app or selling it, CPM advertising campaigns do not work, and it’s best to look for other options.

The rate or quality of user interaction is not counted in this pricing model, and only the number of views is taken into account. The same can be the source of fraudulent actions, which can be prevented by using the right tools and the use of trusted advertising networks.

CPM advertising strengths

CPM ads, like CPCs, can be a consistent and reliable source of revenue for advertisers, provided that high traffic is in place. They are easy to use and easy to use, and do not require specific programming knowledge.

Additionally, the advertiser will not be particularly concerned about the clickthrough rate of this type of advertisement because it charges it for every 1,000 views. In this way, as long as traffic remains acceptable, its revenue will be acceptable to the evaluator.

CPM ads for advertisers also have benefits that are relatively cheaper and more predictable. This type of advertising will be a cost-effective way to generate brand awareness and message transfer to a large number of audience members, provided that the campaign is set up correctly. You can use CPM campaigns along with other CPCs, CPIs or CPAs. Launching this campaign model is easy and hassle-free. There are usually a lot of screenwriters to display ads, and there’s no problem displaying them.

CPM vs CPC

CPM Advertising Model vs. CPC Advertising Model

As mentioned earlier, online businesses focusing on earnings or instant conversion may prefer to pay for their advertising costs in the form of click advertising, per click. While CPM campaigns or paid per visit are more likely to be for companies that are interested in getting the most out of their ads to raise awareness of the brand and increase their audience interest in their products. Advertisers will be better placed to display their ads in the form of a CPM, with the maximum cost they want to spend on 1000 times the ad display as the maximum CPM.

Getting to know the options available

As an application publisher, you need to know how to advertise your apps and convince a huge number of users to download and install them. There are several options for you.

One of the most effective options for you is to advertise your app into other mobile apps and apps that are similar to the users of your potential users. This method can take various forms based on how ads function and how they pay:

تبلیغات CPM
  • CPM model or Cost Per Mille that, which is the initiator of digital advertising, is an old term and its roots are back to print advertising. CPM is a costing model based on every 1,000 visits, and is designed to create awareness of a great brand or app. In this way, brands pay their advertising costs for the amount of advertising that a mobile advertising platform provides for each ad.
تبلیغات کلیکی
  • The CPC or Cost Per Click model is another way to focus on ad performance than CPM. In this way, brands pay only if the user clicks on or clicked on their ad. The effectiveness of this form of advertising is that the advertising platform of the presenter also benefits from the correct implementation of the advertiser’s side. In other words, displaying advertisements at a site with the highest probability of user interaction with that ad in favor of the advertising platform and thereby earning more money.
تبلیغات نصبی
  • CPI or Cost per Install model is assigned to mobile apps. In a CPI campaign, or “cost per installation,” publishers place their digital ads on a range of media, hoping to boost the number of new installs of the ad-supported app. The advertiser’s brand will pay a certain amount for each installment directly generated by these campaigns.
تبلیغات cpa
  • CPA or Cost per Action model, also known as Pay per Action or PPA, is a pricing model for online and mobile advertising, in which the advertiser only pays for the actual implementation of the action by the user after installing the app. This action is defined according to the advertiser’s need and can cover things such as filling in the form, purchase or order.

Each of these mobile advertising methods can lead to more installation; in fact, the difference is in their cost calculation method. So, when you think of using mobile ads to attract more installers, you need to have a clear understanding of how well your campaign can measure success and cost.

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