Wednesday, February 24, 2010

What are CPM, CPC, CPA, CPE, etc in online advertising

You might have noticed that my blog currently serves ads from Google Adsense and Innity Performance Network.

If you are familiar with online advertising, you should know about CPM, CPC, CPA, CPE, etc. If you are new to it, you might wonder what are these jargons about.

Well, they actually refer to the model in which you will be paid for ads running on your website or blog.

  • CPM - Cost Per Mille or Cost Per Thousand Impressions. This is the easiest model to generate earnings, as every time the ads appear to a visitor to your site, you will get an amount of money. The rate is at 1,000 ad served. If your site produces less than 1,000 impressions for the ad, you will get a proportion of it. Google Adsense reports the estimated CPM rate you receive based on your earnings with Effective CPM (eCPM).
  • CPC - Cost Per Click. You'll generate earnings when your visitors click on the ads displayed on your site.
  • CPA - Cost Per Acquisition. You will be paid for leads generated on your site (e.g. product trial sign up, submission of survey, etc.)
  • CPE - Cost Per Engagement. You will be paid for engagements generated by visitors from your site. Engagement is defined when a user response to the ad through the act of experiencing the features of the ad format. These features include advergames, videos or even social sharing.
Currently, you can get CPM and CPC ads from Google Adsense, while Innity Performance Network supports more models including CPM, CPC, CPA and CPE.

The rule of thumb: No matter what the revenue model is, visitor traffic is the key for you to get some earnings from online advertising.

9 comments:

Kenji said... Reply To This Comment

Thanks for the definition. I did not know that CPE exists :P

Voyager8 said... Reply To This Comment

Hi Kenji,

You can have some real experience next time when you see the CPE ads of Tune Money or Air Asia appear in my blog or other websites.

Tekkaus said... Reply To This Comment

Ouh...yeah...adsense kinda...limited. :)

thomas said... Reply To This Comment

Good explaination,have we met before?

Voyager8 said... Reply To This Comment

Hi Bro Thomas,

Ya... you helped me installed the RDS in my car.

thomas said... Reply To This Comment

Hah!Small world,we meet again.
Your blog is very informative that's why i follow.

Anonymous said... Reply To This Comment

Thank you for this amazing post..

Christine @ cpa cpe said... Reply To This Comment

Great post!

I always encounter these words yet never understood what they mean until I found your blog. It is explained thoroughly and now I found its importance.

Thanks for posting!

Adsense said... Reply To This Comment

I am quite interesting in this topic hope you will elaborate more on it in future posts.
I am new to google adsense, thanks..

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