Nowadays, digital advertising in different media is essential. In this way, brands can communicate with their audiences to publicize their products and services, acquire customers and retain them.

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The ads they run must be profitable so that the money is not being poorly invested.

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How do you know you're not wasting your digital advertising dollars?

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This is where the different metrics come into play.

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The CPM, one of the main metrics in the digital marketing universe, allows to know the total amount spent on an ad per 1000 impressions.

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An impression refers only to the fact that the ad has appeared on the user's screen. If we want to think about it in a simpler way, CPM could be understood as when in traditional marketing, a brand puts a billboard on a public road. Impressions are the number of people who see the billboard.

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How does knowing the CPM benefit you?

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• Understanding: This metric will help you understand which ads are seen more and which less. It will help you when developing content for your audiences.
• Brand awareness: one of the main objectives of digital advertising is to make a business known. Knowing how many people saw your ads serves to have a perspective of the people who are knowing about your brand.
• Targeting: Quality and not quantity. Beyond the quantity of people who saw the ad, the correct previous segmentation will make the number of impressions to be of quality, this will increase the profitability of the ads.
• Interaction: A good ad should be shaped by a creative idea. A good visual, a good copy and an eye-catching CTA will be decisive factors. If your ad only generates impressions but does not convert in any way, you should rethink your strategy. Look for your audience to interact with your ad. Clicks, likes, shares, comments, reactions... Look for action!

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How is it calculated?

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You should know:

• The cost of the ad
• The number of impressions

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CPM = Cost / Impressions x1000

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History mode:

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The Puppies brand made an announcement to unveil its new dog leashes.

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The ad was launched in June, via Instagram Stories and an investment of $10,000 was made.

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It obtained 500,000 impressions during that month.

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CPM: (10,000/500,000) x 1,000 = $20

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Then, the cost per 1000 impressions is $20

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