Glossary
Advertising

What is CPM? Definition & How It Works

Quick definition

CPM (cost per mille) is the price of 1,000 ad impressions: spend ÷ impressions × 1,000. It is the standard unit for comparing the cost of paid reach.

Advertising

CPM, explained

Part of the SocialKit social media glossary — browse every term.

What CPM measures

CPM — cost per mille, mille being Latin for thousand — is your ad spend divided by impressions, multiplied by 1,000. It is the base unit of paid distribution: whatever objective you buy, the platform is ultimately delivering impressions, and CPM is what each thousand of them cost. A common variant, vCPM, counts only viewable impressions — those that actually appeared on screen long enough to register by the platform’s definition.

Why it matters

CPM makes the cost of attention comparable — across campaigns, audiences, platforms, and seasons. Because ad prices are set by auction, CPM moves with demand: advertisers widely report it climbing in competitive seasons like the fourth quarter, and narrow audiences or weak ad quality push it up as well. For anyone who also publishes organically, CPM doubles as a yardstick: it tells you what the reach your posts earn for free would have cost as media.

A concrete example

Campaign A spends €300 and serves 60,000 impressions: 300 ÷ 60,000 × 1,000 = €5 CPM. Campaign B spends the same €300 for 25,000 impressions: €12 CPM — 2.4 times the price per view. That alone doesn’t crown a winner: if B’s tighter audience converts at three times the rate, its expensive impressions are the better buy. CPM prices attention; it says nothing about what the attention was worth.

How to use it

Treat CPM as the cost-side diagnostic of your funnel. Rising CPM with steady click-through usually means market pressure — competition or saturation of a small audience; check frequency to confirm. Falling CPM after a creative refresh often reflects the auction rewarding better engagement. Always compare like with like: CPMs differ by objective and placement, so a feed campaign and a Stories campaign aren’t directly comparable.

Where SocialKit fits

Every impression you earn organically is one you didn’t pay a CPM for — SocialKit’s best-time auto-posting publishes when your audience is actually online, stretching the reach each post earns before any budget enters the picture.

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FAQ

CPM: common questions

Quick answers to the questions people ask most about this term.

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