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5 Reasons to Use CPM Buying

Nadia Ozeri, July 28, 2021

Now that we understand CPM a bit better, let’s examine when to use it.

 

Most advertisers may think CPM ads are a bad idea, as it makes intuitive sense to only pay for clicks or purchases that result from your ad. However, buying on a CPM basis gives you leverage that CPC (cost per click) and CPA (cost per action) ad buys do not. Let’s look at the advantages that CPM has.

 

1.Low-cost: CPM advertising has a pretty predictable price. Regardless of whether you’re a brand marketer or a performance marketer, you both benefit from lowering advertising costs. For 1,000 impressions, you pay the CPM bid you declared. Ads generating a high CTR turn out to be a low-cost solution when CPM is used. Buying with CPM can lower overall advertising costs and increase clicks, ROI, and conversions.

 

2. Reach: When using media platforms and CPMs, there are usually a lot of publishers and inventory to choose from.

 

3. Ad fraud: When you purchase CPC ads, publishers are incentivized to generate as many clicks as possible. There is a risk of fraud and bots in these kinds of placements. Fraud should be taken into consideration when using the CPC buying model. Many marketers fall victim to click-injection and click-spamming schemes, and CPC has a bad reputation when it comes to fraud. By using CPM, you can reduce fraud risk.

 

4. Transparency: The most effective way for marketers to protect their ad spend and ensure real transparency is to buy as close to the cost of the media as possible. This way, the incentive is set for your media partner to obtain the highest amount of available quality impressions. Transparency is one of the biggest advantages programmatic advertising holds over the traditional ad network model. Transparency is essential both to ensure brand safety and to obtain performance insights.

 

5. True value:  Tracking impression-level data helps marketers to assess each placement’s true value and learn what contributes to the success of the campaign. The CPM model gives you the ability to measure and combine last-click attribution with view-through attribution. This will show exactly what those impressions are and how they perform.

It may take some testing to find the best place to advertise, but you will likely get better results than if you just paid for clicks. It’s easy to get a high ROI when you pay by CPM, especially when you identify your top-performing creative sets. You will still receive clicks to your website when running CPM campaigns. Basically, you get the best of both worlds. A CPM model allows marketers to pay close to the cost of the media and optimize for the metrics that really matter.

 

I suggest paying CPM, while optimizing for CPC and CPA.

 

Nadia Ozeri is Director of Buy Side at Total Media and an expert in connecting advertisers to ad technologies. Find Nadia on LinkedIn or reach her by email at nadia(at)totalmediasolutions(dot)com.