CPM: Cost Per Mille
CPM is an acronym for cost per mille, meaning the cost per 1000 impressions (or how many times it is seen). This refers to how much it costs to have an ad published a thousand times on a website and is seen by users.
The total cost paid in a CPM deal is calculated by multiplying the Total Impressions by the CPM rate & then dividing it by 1000.
CPC: Cost Per Click
CPC means Cost Per Click, and it’s a method that websites can use to determine the average times an advertiser has clicked on the relevant ad. CPC is also a widely used metric that advertisers incorporate to manage campaign budgets & performance.
CPA: Cost Per Acquisition
CPA is also a payment scheme like CPM and CPC; however, it differs in that advertisers only pay when the user completes the desired transaction, such as a purchase, download or free trial. Therefore, the advertiser only pays when an acquisition is made, therefore, CPA is Cost Per Acquisition.
However, this means that the publisher takes all the risk for running the ad as you will be paid based on conversions made instead of just clicks or impressions. This is often referred to as affiliate advertising & was a widely used model in the mid-2000s.
CPL: Cost Per Lead
CPL defines how much revenue a publisher receives when he creates a lead for an advertiser. For example, the publisher may place an ad for an investment site on his website. If a user clicks on the advertisement link, she is directed to the advertiser’s website where she can sign up for an investment account. If she chooses to sign up, a lead has been created and the publisher is paid a certain amount based on the CPL.
CPI: Cost Per Install
CPI stands for “cost per install,” and should not be confused with the identical acronym for “cost per impression.” While marketing campaigns can exist for both, cost per install has become the dominant approach for the mobile app advertising industry.
Marketers calculate CPI by dividing their ad spend by the total number of app installs generated by the associated campaign. This provides you with a baseline cost to acquire a single user.
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