How Do I Pay For Online Marketing?

Performance Marketing Metrics are as follows:

Cost per mille (CPM)

CPM also called cost ‰ and cost per thousand , is the commonly used measurement in online advertising. In Latin mille means thousand, therefore, CPM means cost per thousand. When it refers to online advertising it can be purchased on the basis of what it costs to show the ad to one thousand viewers (CPM). Rather than an absolute cost, CPM estimates the cost per 1,000 views of the ad.

An example of calculating how many times your ad will be shown online:

  • Advertising budget for the CPM campaign is $10,000.
  • CPM rate for the website is $2.50
  • The total impressions can be calculated as ($10,000/CPM) x 1000 = 4,000,000

An example of calculating the CPM rate for your campaign:

  • The CPM is calculated as CPM = ($10,000 x 1000) / 4,000,000 = $2.50
  • CPM can also be calculated as CPM = $10,000 / (4,000,000 / 1000) = $2.50

Cost-per-action (CPA)

CPA, also known as cost-per-acquisition, is pricing based on the number of actions in response to your ad. An action may be defined as a sales transaction, a customer acquisition, or simply a click. CPA may also refer to cost-per-acquisition or cost-per-sale. CPA is essentially a very low risk advertising model. Rather than using your marketing market budget, treat CPA as a cost of goods sold. CPA is your online commission only sales person.

Cost-per-click (CPC)

CPC is pricing based on the number of clicks your ad receives. CPC may also refer to cost-per-customer. CPC is your typical Google modeling and is quite effective in attracting the right clients through the right targeted key words to attract your targeted audience. CPC campaigns are highly dependent on the conversion of your landing page(s).

Cost-per-lead (CPL)

CPL is pricing based on the number of new leads generated by your ad. For example, if a user clicks on your ad and fills in an enquiry form/application form or survey this accounts for a Cost per Lead.

Contact The Performance Factory on how to utilise the above online marketing methods.