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What is CPM, and Why is it Important for Business Marketing?

Amita Kumari Published on : 14 March 2022
what is CPM?

 

Have you ever wondered; the scenario where there is no advertisement in the marketing world. What will the businesses do, how will they establish brand presence? How will they promote their business and solutions? 

An advertisement gives the very first intro of the business to the customers. Earlier, it was the traditional advertisements like Tv ads, magazines, newspapers, pamphlets, hoardings, while the current digitized advertising channels abound social media ads, emails, affiliate marketing, etc. Product advertisement handles multiple processes that are a part of initial stages like promotion of products to create customer apprehension of the business and includes later stages like comparisons with competitors and lead conversions.

In the digital world, people are more inclined towards video streaming than other types of media. The essentiality of performing ad-based advertisements has hence surged. CPM is one of the most successful ways of performing brand advertisement over the streaming network. You must be thinking, CPM? What is that? Is it important for business advertisements? How to use it, and what are the benefits?

To help you in understanding the effectiveness of CPM, in this blog, we are going to discuss what CPM is and why businesses should use it in their marketing activities.

What is CPM?

CPM stands for Cost per Mille. Mille is a Latin word that represents thousand. Hence CPM is also known as cost per thousand. It can also be defined as a paid advertisement option. Here, for every 1000 impressions an ad receives, the associated organization whose product/services are advertised pays some price to the website/platform owner where the ad is displayed. (Each time an ad is viewed by or displayed to the audience, one impression is counted.)

CPM campaigns are proven to be the best towards raising awareness and brand recognition. This awareness focuses on people looking for the same type of solution that the business is offering.

 

How to calculate CPM?

There is a simple formula to calculate Cost per Mille. 

CPR= Cost(total budget of the advertisement campaign)/1000 Impressions 

 

Why should businesses start CPM campaigns right away?

Several marketing techniques are readily available for generating revenue, leads, and partnerships. But why bother about CPM campaigns? The use of CPM becomes a necessity for businesses in scenarios where the organizations are wholly new and struggling to get that desired brand presence in the digital platform, where there are hundreds of industry giants that keep on gaining new deals, engagement, and success. The most critical requirement of new businesses is building brand presence, and CPM serves the same. 

It is a matter of good fortune when a customer clicks on an ad of a brand that they have never listened to before. CPM campaigns work best towards creating brand awareness for the VOD platform. By displaying brand ads in videos watched by the targeted customers and recommended videos list, it by default creates brand awareness among the customers and eventually develops a sense of business royalty and effectiveness among the targeted audience group.

 

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Benefits of CPM Advertising- 

1- CPM campaigns are budget-friendly-

When it comes to digital programmatic advertising, businesses have different options like CPM, CPI, CPC, CPA to opt for. Amongst all, CPM is the most popular model for advertisement-based marketing for Video on Demand service providers. In CPM, businesses do not risk anything, and they need to pay when they get the result; that is a thousand impressions on their ads. The expense of CPM depends on the popularity/reputation of the platform/channel on which the campaign is running. If the advertising platform is a popular one or a reputed business with high brand value, CPM expense can be higher, while platforms with limited audiences can cost less.

2- No need to focus on keywords-

With Cost per Mille ads, publishers do not have to focus on keywords to drive engagement to their ads. CPM in business works on programmatic advertising customized towards the targeted customer groups.

3- With Cost per Mille, you create the highest brand credibility and awareness-

By running CPM campaigns, businesses get a grand opportunity of conveying their brand presence, perspective, and customer-centric services. When the customers view the business ads, they feel connected to the solutions and inevitably develop an enthusiasm to know more about business offerings.

4- CPMS makes it easier for businesses for lead generation-

With CPM, businesses like OTT platform providers and VOD platform providers can reach out to their exact targeted group of audiences; who need their service/solutions and hold the maximum potential of conversion from lead to client/customer. This way, enterprises pay only for targeted leads generated and get 100% results from the campaigns.

5- CPM campaign performance is easy to monitor-

With professional ad server providers, businesses get performance analytics. It works best towards measuring the CPM campaign success through analyzing different metrics. 

One of the most popular metrics used to monitor the success ratio of CPM campaigns is the click-through rate, commonly referred to as CTR. CTR shows the number of clicks you get on your ad when displayed to the customers. Apart from that, other metrics like sales, watch time, the device used can also be helpful towards measuring viewer engagement towards the ads and accordingly help towards better targeting of future CPM campaigns.

 

 Wrapping up-

To help businesses start with their CPM campaigns, Muvi One is offering an advanced ad-server which is also present as an independent product of Muvi known as Muvi Ads. Muvi One is one of the finest all-in-one streaming platform providers globally. We at Muvi are focused on fulfilling the streaming needs of customers and the revenue targets of businesses. 

By implementing Muvi’s ad server, businesses can effortlessly handle their CPM advertising campaigns across different platforms and devices like mobile, desktop, and other connected devices. The advanced enterprise-grade ad server supported by Muvi is VPAID compliant according to IAB guidelines and effectively supports all AD formats. 

Muvi’s Ad server supports native advertising, geo-targeting, reporting & analytics, dynamic ad insertion, and managing Ads on one platform. With end-to-end ad management, Muvi also offers 24*7*365 uptime and scalability. 

The versatility of Muvi’s Ad solution allows you to create multiple ads for different brands. You can also add VAST category and advertiser to make your ad more effective. It also provides ad tags used for integrating ads into videos. Apart from that, businesses also have the option to make the ad skippable/ non-skippable. 

Businesses can also integrate their own VAST/VMAP compliant Ad server with Muvi One. Muvi supports integration with SPOX, Muvi ads, Google Ad Manager, and other third-party servers via BYOA (Bring Your Own Apps). 

 To know more about Muvi’s Ad server, we encourage you to take a 14-day free trial of Muvi One and get a real-time experience of its functionality and integrations.

Start your free trial now!

 

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Written by: Amita Kumari

Amita is a content writer with Muvi marketing team. She has over 5+ years of experience in content creation and development. Passionate by heart, she likes to cook, write, sing and do yoga to pass time.

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