CPM (cost per mille)


Payment model for (online) advertising: cost per 1,000 served ads/impressions

Calculating CPM

advertisement placement costs

_______________________________ = CPM

number of impressions (x 1,000)

Are we talking about served ads or impressions?

A served ad becomes an impression when it is viewed by a real person (and not a bot). The international guidelines of the IAB state that in order to speak of a “viewable” impression, 50% of a normal display advertisement or banner must be visible for a minimum of 1 second. For larger advertising formats 30% is sufficient. Video should not only be 50% visible, but also for a minimum of 2 seconds.

How can you realistically implement this model?

Not all providers use the same methods to measure viewable impressions. In addition, many impactful advertisements, such as roadblocks or homepage takeovers, are difficult to measure with the current available tools. This also means that impressions that aren’t measured are not necessarily also “unviewable”.

With the technical limitations to measure everything correctly, the payment model based on 100% viewable impressions is not realistic. So what is?

The IAB issued the following guidelines in 2015:

  • Invoices must be based on the number of served ad impressions during a campaign; these should be divided into two categories: measured and unmeasured impressions
  • Given the current technological limitations and differences when it comes to measuring impressions, you could consider 70% viewable impressions as the minimum

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