CPM Advertising
In the internet advertising world, there are numerous different ways in which a website can sell advertising. One of the most widely used methods that a lot of very large websites employ is a method called CPM advertising. CPM stands for cost per thousand impressions. The M is the Roman numeral for 1000. M = 1000. Therefore, in this business, people are either buying or selling ads that will get a thousand impressions. Often times, though, they’re not buying a thousand impressions. Instead, they’re purchasing a hundred times more.
CPM advertising is the cheapest method of buying/selling advertising because, instead of buying a click through, a lead, or a sale, the only thing that is being exchanged is views. Whether or not someone clicks is irrelevant. Views are what is for sale, not whether the advertiser is going to get any traffic to their site. The hope, though, is that there will be clicks which will make the advertisement well worth the investment.
CPM advertising on the internet can be compared to the kind of advertising that is seen in magazines. They don’t sell a promise that sales will be made. They sell the promise that the ad will be viewed. The same thing happens on the internet. In no way does a website promise that a click will occur. Instead, all they promise is that the ad will be viewed. However, if no clicks are made, the publisher is bound to lose out on an advertiser. As much as there is no guarantee that a click will be made, the bottom-line is that the advertiser wants clicks. So, it is in the publisher’s best interest to ensure the ad is in a good place that ensures it will be clicked.
CPM advertising is an inexpensive way to get ads on a website. However, it typically only works for large sites. Large sites can provide a ton of bulk impressions, so advertisers are more interested in buying from there. The hope when using CPM advertising is to have the ad visible so that it makes an image in the visitor’s eye, and so, after a while, it is clicked. CPM advertising is one of the oldest forms of advertising online and the reason it is still around today is because it is inexpensive for the advertiser and potentially very profitable for the publisher. Both sides are working with impressions only. There’s no need to rely on the visitor to do anything other than come to the site and see the ad. That makes the concept of CPM advertising very practical and profitable.
