CPM is the cost of a thousand impressions — the M is the Roman numeral for a thousand, not million, which is the first thing that trips people up. It is the standard currency of brand and display buying, where the advertiser pays for exposure rather than for response, and it is quoted per thousand simply because the per-impression figure would be an awkward fraction of a penny.
A CPM cannot be compared with a CPC directly, and yet the two are constantly set side by side. The bridge between them is the click-through rate: effective cost per click is CPM divided by a thousand times the CTR, so a five pound CPM at a 1% CTR is a fifty pence effective CPC, while the same CPM at 0.1% is five pounds a click. Any comparison of a reach buy against a performance buy has to pass through that conversion first.
This calculator carries the chain one step further, through the conversion rate to a cost per acquisition and a return on ad spend, so a CPM-priced placement can be judged on the same terms as a performance campaign. On the sample entries $3,800 across 420,000 impressions is a $9.05 CPM, which at 0.9% CTR is $1.01 an effective click and at 1.8% conversion is $55.85 per acquisition.
The formula
Spend- Total media cost
Impressions- Times the advert was served or seen
CTR- Click-through rate used to derive the effective CPC
Conversion rate- Share of clicks converting, used to derive CPA
How to use this calculator
- Enter total spend and impressions delivered.
- Enter the click-through rate the placement achieves.
- Enter the conversion rate on those clicks and the value of a conversion.
- The gauge shows CPM; effective CPC, CPA and ROAS follow below.
Worked examples
$3,800 across 420,000 impressions
CPM is $9.05, which is $0.00905 for a single impression. At 0.9% CTR the 3,780 clicks cost $1.01 each, and at 1.8% conversion the 68 conversions cost $55.85.
Comparing a CPM buy with a CPC buy
The same $9.05 CPM is worth $9.05 per click at a 0.1% CTR, $1.01 at 0.9%, and $0.30 at 3%. Without the click-through rate the CPM figure cannot be compared with a cost-per-click quote at all.
How to read your score
Frequently asked questions
Does the M in CPM mean million?
No — it is the Roman numeral for a thousand. CPM is cost per thousand impressions, which is why you divide impressions by a thousand before dividing the spend.
How do I compare a CPM buy with a CPC buy?
Convert the CPM to an effective cost per click by dividing by a thousand times the CTR. Only then are the two prices measured in the same unit.
Is a low CPM good?
Only if the impressions are seen by people who might buy. Cheap inventory is cheap because it performs poorly, and the effective cost per acquisition usually reveals that far better than the CPM does.
What is viewable CPM?
vCPM prices only impressions that met a viewability standard, typically half the advert visible for at least a second. It is always higher than raw CPM, and the gap tells you how much of the inventory was never actually seen.
CPM reference
| Media spend | 100000 impr | 250000 impr | 420000 impr | 1000000 impr | 3000000 impr |
|---|---|---|---|---|---|
| spend $500 | $5.00 | $2.00 | $1.19 | $0.50 | $0.17 |
| spend $1500 | $15.00 | $6.00 | $3.57 | $1.50 | $0.50 |
| spend $3800 | $38.00 | $15.20 | $9.05 | $3.80 | $1.27 |
| spend $9000 | $90.00 | $36.00 | $21.43 | $9.00 | $3.00 |
| spend $25000 | $250.00 | $100.00 | $59.52 | $25.00 | $8.33 |
CPM is spend divided by impressions, times a thousand.
| CPM | At 0.05% CTR | At 0.2% CTR | At 0.9% CTR | At 3% CTR |
|---|---|---|---|---|
| $1.50 | $3.00 | $0.75 | $0.17 | $0.05 |
| $4.00 | $8.00 | $2.00 | $0.44 | $0.13 |
| $9.05 | $18.10 | $4.53 | $1.01 | $0.30 |
| $15.00 | $30.00 | $7.50 | $1.67 | $0.50 |
| $30.00 | $60.00 | $15.00 | $3.33 | $1.00 |
The same impression price produces wildly different click prices. Click-through rate, not the CPM, decides whether a reach buy is competitive with a performance buy.