CPM formula: (Ad Spend ÷ Impressions) × 1,000. Step-by-step examples for Meta, Google Display, YouTube, and LinkedIn wit...
CPM = (Total Ad Spend ÷ Total Impressions) × 1,000. Example: $500 spend generating 125,000 impressions = ($500 ÷ 125,000) × 1,000 = $4.00 CPM. This means you're paying $4 for every 1,000 people who see your ad.
Total Spend = (CPM × Impressions) ÷ 1,000. Planning a campaign: $8 CPM × 500,000 target impressions ÷ 1,000 = $4,000 budget required. Use this for media planning before campaigns launch.
Impressions = (Budget ÷ CPM) × 1,000. $2,000 budget at $10 CPM = ($2,000 ÷ $10) × 1,000 = 200,000 impressions. Essential for estimating reach when planning awareness campaigns.
Meta Ads: $7–$14 CPM. Google Display: $2–$5 CPM. YouTube: $6–$12 CPM. TikTok: $8–$15 CPM. LinkedIn: $28–$65 CPM. These ranges assume standard targeting — narrow audiences, Q4 timing, and conversion-optimized objectives push CPMs toward the upper end.
Three factors drive CPM: audience competition (finance and legal audiences are expensive because many advertisers want them), placement quality (in-feed vs. sidebar), and timing (Q4 BFCM period can 2× baseline CPM). A $12 CPM on LinkedIn targeting CFOs is 'cheap' relative to the audience quality.
eCPM (effective CPM) is calculated from campaigns bought on CPC or CPA basis: eCPM = (Total Spend ÷ Total Impressions) × 1,000. eCPM lets you compare cost efficiency across campaigns bought on different pricing models — $0.50 CPC generating 0.05% CTR equals $25 eCPM, which looks expensive vs a $10 CPM direct buy.
Use CPM when: campaign goal is brand awareness or reach, buying video or display inventory, comparing media efficiency across channels at the awareness stage, or running broad prospecting. For conversion-focused campaigns, shift focus to CPA — CPM efficiency doesn't guarantee conversion efficiency.