That’s an interesting question for the experienced online marketers and a rather confusing one for the Internet novices who want to make an incursion into the world of online advertising.
But let’s give up acronyms and baffling jargon and let’s see what is all about. Advertising on the Internet can be purchased in various systems, the most common being CPM (Cost Per Mille), CPC (Cost Per Click) and CPA (Cost Per Action).
CPM alias Cost Per Mille alias Cost Per Thousand impressions
Represents how much it will cost for an ad to be shown a thousand times. For example, a website could sell banner ads for $50 CPM. CPM is used not only in online advertising, but also in television, radio and in print.
The CPM system favours only the publishers because they’ll receive revenue regardless of the campaign’s success. Also, a thousand impressions doesn’t guarantee that the ad will be actually seen 1000 times; the system only guarantees that it will be displayed 1000 times for a certain amount of money. The system’s most important advantage for advertisers is the fact that they can easily compare media prices.
These facts made many of the advertisers move towards CPC and CPA.