CPM (Cost Per Mille) is the cost paid per 1,000 ad impressions. It charges based on impressions, not clicks. CPM is mainly used for display and video ads aimed at building brand awareness.
Formula and Interpretation
CPM = (Ad Spend ÷ Impressions) × 1,000
For example, if you get 1,000,000 impressions for KRW 2,000,000, your CPM is KRW 2,000. A lower CPM means more impressions for the same budget. But a low CPM is meaningless if impression quality is poor.
- Broader targeting tends to lower CPM
- Highly competitive placements drive CPM up
- Video and premium placements carry higher CPM
When to Use It
CPM fits campaigns where the goal is reaching many people rather than clicks or conversions. Typical examples are new product launches and brand launches, where reach itself is the KPI. This is why it is common in Display Ads (DA) and branding campaigns.
If you want immediate action, the click-based CPC is a better fit. If app installs are the goal, review CPI alongside it.
Pricing Model Comparison
| Metric | Charged On | Best For |
|---|---|---|
| CPM | 1,000 impressions | Awareness, reach |
| CPC | Clicks | Driving traffic |
| CPI | Installs | App downloads |
Notes
CPM only shows impression efficiency. To judge actual performance, review it together with Click-Through Rate (CTR), Conversion Rate, and ROAS.
If ads are how you buy reach, SEO and GEO, which accumulate organic impressions, offer strong long-term complementary value. 238lab designs the balance between paid and organic visibility together.