What Are CPM, CPA, CPC, CPL, CPS and CPI?

Quick Introduction!

Digital marketing is all about 6 acronyms. You will always likely to hear more often are CPM, CPA, CPC, CPL, CPS and CPI.

What is CPM?

In the online advertising world, it means Cost per Thousand-page impression. It is usually linked with the total numbers of clicks by the users on a website. Various Ad networks such as Media.Net and many others calculate the ad revenue for websites on the basis of CPM.

It is also one of the recurrent ways of buying digital media. Every time your ad loads on a page or in a mobile application you have to pay for it no matters what. In the CPM model, the client always gets charged for the impression regardless of consumers actually sees it or not.

The websites that offer targeted audience can have high CPMs

How CPM Rates Work

CPM Formula: How CPM Rates Work

What Is CPA?

CPA stands for Cost per Action or Acquisition. This model demands some extra steps from the publishers in order to get compensated. In this campaign, the advertisers only pay to publishers if a purchase is made. This is a relatively low-risk way to buy media for the advertisers but for the publishers takes all the risk and runs the ad.

If no one buys the publishers will not make any money that’s why this is best for banner advertisement and worst for the rate to charge.

How CPA Marketing is working

How CPA Marketing Works

What Is CPC?

CPC stands for cost per click advertising. In this model of advertisement, the advertisers will pay the publishers every time their ads are being clicked. In general, the advertisers are paying for the traffic redirected by the publisher’s website.

Usually, advertisers around the world prefer CPC they know by using this they will only pay when a user is interested enough in the message to want more.

There is also a drawback that what if someone deliberately uses bots to generate clicks other than a click originated by a real person.

CPA Marketing

Most Bang For your buck

What Is CPL?

CPL stands for Cost Per Lead. This model allows advertisers to pay only when the lead form is completed and submitted. It is most often used in business-to-business marketing model where it is more quite that someone will make a purchase right at the moment.

It is one of the most effective ways to buy but again there is a risk of fraud present that what if someone programmed the bots to fill in the leads on their own?

How to Calculate Cost Per Lead?

CPL Formula Work Out How much each lead costs.

What Is CPS?

CPS stands for Cost per Sale. This model is the same as the CPA. Specific steps have to be made by the publishers in order to get paid.

What Is CPI?

If we talk about mobile app marketing CPI comes to one’s mind it stands for Cost Per Impression. In this model, the advertisers pay for each of the installed apps. It is a widely used model for mobile marketing because it’s one of the most effective ways to drive installs.

Like every other model, it also has the risk for fraud like some low-standards companies use bots to draw installs and you know what that’s bad really bad!

CPI Formula

Work Out How much each install costs

Which Model is Best

Well, this is a question which is hard to answer. There is no concrete answer for this or specific criteria it totally depends on your targets, objectives and goals. What most important is to always have high-quality third-party verified info about the results each vendor provides regardless of which model of marketing you are choosing.

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