Cost per mille (CPM) is an advertising pricing model in which the advertiser pays a set rate for every one thousand impressions served — "mille" being Latin for thousand. It is the most widely used pricing model in digital and programmatic advertising, the default currency for buying and selling ad inventory at scale. A $5 CPM means the advertiser pays $5 for every 1,000 times the ad is displayed.
 

CPM is calculated by dividing total campaign cost by total impressions, then multiplying by 1,000. Spend $2,000 to serve 500,000 impressions and your CPM is $4. Because it standardizes the price of reach, CPM lets advertisers and publishers compare the cost of inventory across very different sites, formats, and channels on a common basis.
 

CPM is especially well suited to brand awareness and reach campaigns, where the goal is to put a message in front of as many relevant people as possible rather than to drive an immediate action. For these objectives, paying per impression aligns cost with exposure. Even performance campaigns often transact on a CPM basis while optimizing toward downstream goals like clicks, conversions, or installs — the DSP buys impressions at a CPM but bids more aggressively on the impressions most likely to deliver results.
 

CPM rates vary widely based on inventory quality and targeting. Premium publishers, highly targeted audiences, viewable placements, video formats, and scarce inventory command higher CPMs. Remnant inventory, broad untargeted reach, and below-the-fold placements clear at lower CPMs. Factors like geography, device, seasonality, and competition all move the price.
 

An important refinement is eCPM (effective CPM), which expresses the revenue or cost per thousand impressions regardless of how the deal was actually priced. eCPM lets publishers compare the performance of inventory sold under different models — CPC, CPA, or CPM — on a single normalized basis, and it's central to yield optimization. Another key concept is the floor CPM, the minimum price a publisher will accept per thousand impressions, which protects inventory value in the auction.
 

For advertisers, CPM is the foundation of media cost planning, but it should always be evaluated alongside outcome metrics. A cheap CPM that reaches the wrong audience or non-viewable placements is no bargain; a higher CPM that delivers viewable impressions to a precise, high-value audience often produces far better ROI. Measuring CPM against viewability, engagement, and conversions ensures advertisers buy real value, not just cheap volume.