WHAT ARE CPM, CPC, CPL,CPA, CPS & CPI MEDIA BUYING MODELS?

CPM

CPM stands for cost per
thousand Impressions (the
M is the Roman numeral
abbreviation for 1,000.)
CPM is one of the most
common ways of buying
digital media. You essentially
pay for every time your
ad loads on a page or in an
app. It’s a simple way to
buy, but is coming under
increasing scrutiny because
the client is charged for the
impression whether or not a
consumer actually sees it. If,
for example, the ad appears
below the browser window
and the user never scrolls
down, the advertiser still
pays.

CPC

CPC stands for cost per
click advertising. Here the
advertiser pays when a click
is made on an ad. Some
advertisers prefer to buy
CPC versus CPM because
they believe they only pay
when someone is interested
enough in the message to
want more info. Some CPC
programs are very effective,
but there is a potential for
fraud if a company deliberately
uses bots or some
other technique to drive
clicks not initiated by a real
person.

CPL

CPL is short for cost per
lead, meaning that the
advertiser pays when a
lead form is completed and
submitted. CPL is common
in B2B marketing, where
it is unlikely that someone
will make a purchase immediately.
It can be a very
effective way to buy, though
there is some risk of fraud if
bots are programmed to fill
in leads automatically.

CPA or CPS

Cost per acquisition or cost
per sale. Here the advertiser
pays only if a purchase
is made. This is relatively
low-risk way to buy media
because the advertiser
only pays when revenue
is driven. But many media
companies won’t sell media
this way because they must
assume all of the risk in the
ad buy. If no one buys, they
make no money.

CPI

In mobile app marketing,
CPI refers to media programs
where the advertiser
pays for every installed app.
Lots of app marketing is
purchased CPI, because it is
a fast way to drive installs.
But the quality of installs
driven varies by media
vendor. Some CPI vendors
are extremely reputable,
and work hard to find users
that will likely use an app.
Others use incentives like
giving a user free “gold”
for a game in exchange for
their downloading an app.
These “incentivized installs”
tend to be of low quality. In
addition, there are also very
disreputable companies
that drive installs with bots.