Cost Per Thousand (CPM) allows a media planner to compare media based on two variables: audience and cost. CPM is used as a comparative device.
The lowest cost per thousand medium is the most efficient, all other variables being equal. Oftentimes the media with the lowest cost per thousand are selected, but not always. CPM may be computed for a printed page or broadcast time, and the audience base may be either circulation, homes reached, readers, or number of audience members of any kind of demographic or product usage classification.
CPM = ((Cost of 1 ad x 1000) / Number of prospects reached)
Cost Per Thousand (CPM) allows a media planner to compare media based on two variables: audience and cost.
CPM is used as a comparative device.
The lowest cost per thousand medium is the most efficient, all other variables being equal.
Oftentimes the media with the lowest cost per thousand are selected, but not always.
CPM may be computed for a printed page or broadcast time, and the audience base may be either circulation, homes reached, readers, or number of audience members of any kind of demographic or product usage classification.
CPM = (Cost of 1 ad x 1000) / Circulation
*Because many print media do not have audience research data, this formula is often used.
Cost per thousand for a broadcast schedule can be determined from the cost per target audience rating point (abbreviated cost per point or CPP).
CPM = (CPP X 100) / (Population/1000)
