Definition
CPM (Cost Per Mille) is the price for 1,000 ad impressions. Spend €6 to reach 1,000 people and your CPM is €6.
Also called: CPM, Cost Per Mille, Cost per thousand impressionsWhat do 1,000 impressions cost?
Change the inputs to see how numerator and denominator affect the result.
What drives CPM
CPM reflects auction pressure: how many other advertisers are bidding on the same audience. That's why CPM rises in peak season (Black Friday, the holidays), in attractive audiences and on premium placements. It's a price for attention, not for results.
A rising CPM isn't necessarily a problem. If conversion rate and AOV keep up, expensive impressions can be perfectly profitable. And a low CPM is worthless if it comes from cheap placements that don't convert.
CPM in the bigger equation
CPM is the top link in the chain: CPM → CTR → CPC → CVR → CPA. A poor CPM can be rescued by strong creative (high CTR) and a good landing page (high CVR). That's why we rarely optimize CPM in isolation — we look at what the impressions ultimately cost per order.
If you want to lower your real cost, creative is often a stronger lever than chasing cheap impressions: a higher CTR lowers CPC directly, even when CPM is unchanged.
Frequently asked questions
Why is my CPM rising?
Usually because auction pressure is rising — more advertisers bidding on the same audience, often in peak season. It's rarely a problem in itself, as long as conversion rate and order value keep up, so the impressions stay profitable.
Is a low CPM a goal in itself?
No. A low CPM from cheap, poorly converting placements is worthless. What counts is the total cost per order (CPA) and the profit behind it — not the price of being seen.
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About the author
Nicklas Segatz Mortensen
Growth hacker and fractional CMO with 10+ years' experience and hundreds of millions in managed ad spend behind him. Background from larger Danish and international scale-ups, and from the agency world.
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