What Are The Pros & Cons Of Cpc Advertising Vs Cpm Advertising?
You’ve heard the terms “CPC” and “CPM” advertising, but what do they mean?
CPM symbolizes “cost per thousand impressions,” while CPC stands for “cost per click.” Each campaign has advantages and disadvantages, depending on what your business needs are.
CPM
CPM symbolizes “cost per thousand impressions.” With this particular type of campaign, you pay a fixed rate for every thousand impressions that appear on your ad banner on a search engine page, for example. You pay in advance and you know exactly how much you’re going to spend on advertisement every month or every quarter. This may be a cost-effective way to go if your product is very popular.
CPC
As stated above, CPC symbolizes “cost per click” advertising. This is an extremely popular way to advertise on the web, because you pay per click instead of per thousand impressions. This means that every click you get is a potential sale. This, in turn, can be more cost effective. Because you only pay for the clicks you get, this can be very good as a cost-effective way to advertise your product, since you get something for each click you pay for — namely, a visitor who is quite likely looking for your product or service based upon the keywords they’re searching.
CPM, also known as Cost Per Thousand Impressions works a tiny differently. You pay in advance for your impressions. You get 1,000 impressions, which means that your advertisement will show up 1,000 times to visitors and you’ll pay for those impressions rather or not someone decides to click on the advertisement.
This method, too, has advantages in that the price is fixed, and you can know in advance just exactly how much you’ll be spending on advertisement. By contrast, CPC is a little more flexible, and you won’t always know just exactly how much you be paying every month.
Which of these two methods is most cost effective? It depends on what you need. If you use CPC, you know the traffic you’ll get will be targeted. Your advertisement will only appear when someone is searching for your specific keyword. Because you’ve tied this keyword in with your campaign, the person who sees your advertisement and then clicks on it is much more apt to purchase the product or service you offer; in many cases, what you’re offering is exactly what they’re looking for.
By contrast, with CPM, this might be particularly cost-effective if your product is very popular and your advertisement as well is very visible. If your click through rate is high, for example, then CPM is probably more cost effective for you than CPC.
If you determine your business needs, this will help you determine which type of ad campaign is right for you. In addition, think about your budget, your current success rate with clickthroughs, and the success of your current advertising campaign if you’re using one.
Choosing the right one for your company means that you need to determine just what your business needs. Take a look at your budget, your needs, and your current advertising methods and determine which form of advertisement is ideal for you.
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