What is CPM and how is it used in planning?

• A. Cost per mille.
• B. Cost per click.
• C. Cost per mille (CPM) equals cost per 1000 impressions; used to compare efficiency across media channels and decide where to allocate spend.
• D. Cost per engagement.

Answer: (C)

CPM, or cost per mille, is a pricing model used in media planning that measures what you pay to deliver 1,000 ad impressions. In planning, you translate the expected number of impressions across different channels into a CPM figure so you can compare how much each channel costs to reach the same-sized audience. Because impressions are a common, scalable metric across media, CPM helps you assess efficiency and decide where to allocate spend to maximize reach within a given budget. It’s important to remember that CPM reflects exposure, not engagement or actions, so you’d combine it with metrics like clicks or conversions to gauge overall effectiveness.