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CPM / TKP (Cost per Mille / Cost per Thousand Impressions)

Cost per Mille (CPM) is the price for every thousand ad impressions.

What does CPM mean?

CPM stands for Cost per Mille, where the Latin word “mille” means one thousand. In German, it is referred to as the “Tausend-Kontakt-Preis” (TKP).

This is a pricing model in which a company pays for every 1,000 times an ad is displayed. Whether the ad was clicked is irrelevant. Billing is based solely on the number of impressions, which clearly distinguishes the TKP from the cost-per-click (CPC) model. With CPC, costs are incurred only when a user takes an action; with CPM, however, costs are incurred simply by the ad being displayed.

Where does Cost per Mille originate?

Cost per mille was already used in traditional advertising on radio, TV, and in print, where advertising costs were based on the number of impressions reached. CPM is thus one of the oldest metrics in advertising. Its adaptation to online marketing is therefore only logical, since presence and brand recognition are also key here—as is the case with banner and video ads.

Why is CPM important?

Often, the goal of an ad is to increase brand awareness or to leave a lasting impression. The focus is therefore on achieving the highest possible number of impressions. The purpose of the cost per thousand impressions is to calculate the cost of awareness campaigns or brand-building advertising across various channels. It clearly indicates how much it costs to achieve 1,000 impressions of a message.

Advantages

  • CPM makes it easier to plan for the costs of reach and impressions.
  • It is ideal for brand awareness goals, where presence matters more than an immediate response.
  • It is a cross-industry standard that allows for comparing the costs of reach across a wide variety of media.

Challenges

Visibility is not the same as perception. While an impression is counted, whether it was actually seen and registered is another matter entirely. The success of CPM advertising is harder to prove, as its impact cannot be directly measured in clicks.

Cost per mille is primarily suited for visibility and brand awareness goals and less so for campaigns whose success is measured directly by clicks or inquiries.

Example

A regional supplier of bathroom accessories wants to increase brand awareness before attending a trade show. The company books banner ads on industry portals on a CPM basis and sets visibility as its goal rather than clicks. For 800 euros, at a CPM of 8 euros, they achieve approximately 100,000 impressions among industry professionals.

Related terms

Impression The term “impression” means that a piece of content—whether it’s an ad, a post, or a search result—was displayed to a user. Display Advertising Display advertising refers to visual ads such as banners, videos, images, or animations on websites, in apps, or in other digital environments. Programmatic Advertising Programmatic advertising is the automated buying and selling of digital ad space. Brand Awareness Brand awareness indicates how many people are familiar with a brand and whether it comes to mind on its own.