Cost Per Mille (CPM) / Effective Cost Per Mille (eCPM)

Also known as: cost per thousand

CPM is the price an advertiser pays for 1,000 ad impressions. "Mille" is Latin for "thousand," which explains both the name and the unit. Because the cost of a single impression is extremely small — sometimes as little as $0.0015 — it's impractical to quote rates on a per-impression basis, so the industry standardized on the per-thousand convention.

The formula is straightforward:

CPM = total cost of campaign ÷ total number of impressions × 1,000

eCPM (effective cost per mille) is a normalization metric. It answers the question: if this campaign had been bought on a CPM basis rather than on clicks (CPC) or conversions (CPA), what would the equivalent per-thousand cost have been? This makes it possible to compare performance across campaigns that used different pricing models on a common scale.