CPM:

CPM is the abbrevation for cost per a thousand ad impressions. The M in this case should not be misinterpreted as "million" but comes from the Latin number "M" for 1000.

In a CPM advertising model ad publisher and advertiser agree upon a fixed cost for 1000 impressions, which depends on the traffic to the publishing website, the competitiveness of the niche and also on other factors. This means when a website is visited 1000 times with the ad displayed, the advertiser has to pay the agreed amount, no matter if the ad was clicked on or not.

Therefore CPM can be a more risky form of paid advertising compared to CPC (cost per click) models but with a very good ad design and ad copy, which generates a lot of clicks, it can be more cost-effective as quite often CPMs and CPCs within a certain niche are pretty much in the same price range.

[Cost is from Latin constare= to be fixed, to cost;

M is from Latin mille = thousand]

 

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