CPM is a reach metric
Cost per mille prices attention rather than action. It is the right measure for awareness campaigns, launches and anything judged on how many people saw the message rather than how many clicked it.
It is also the currency underneath most auction platforms. Even when you are billed per click, the platform is internally comparing your effective CPM against other bidders — which is why a high CTR lowers your cost per click.
The formula
Effective CPM from CPC = CPC × CTR% × 10
Worked example
₹18,000 for 900,000 impressions
- Total spend
- ₹18,000
- Impressions
- 900,000
- CPM
- ₹20.00
- Cost for 1 million impressions
- ₹20,000
Impressions are not people
An impression is one appearance of an ad. Reach is the number of distinct people. Frequency is impressions divided by reach. A campaign with 900,000 impressions and 150,000 reach has shown the same ad to each person six times.
For most Indian SMB campaigns, frequency above four in a short window produces diminishing returns and rising negative feedback. If your CPM is climbing mid-campaign, saturation of a small audience is the usual cause.
What moves CPM
- Audience size. Narrow targeting raises CPM because you are bidding against everyone else who wants those same people.
- Seasonality. Festival season, quarter-end and major sale events raise CPMs across the board in India.
- Placement. Feed placements cost more than Audience Network or Reels overlays.
- Creative quality. Platforms subsidise ads people engage with, so good creative genuinely lowers CPM.
Frequently asked questions
What does CPM stand for?
Cost per mille — the cost of one thousand impressions. Mille is Latin for thousand.
Is a low CPM always better?
No. Cheap impressions from a poorly matched audience cost less and achieve less. Judge CPM alongside the outcome the campaign is meant to produce.
What is a typical CPM in India?
Meta placements commonly run between ₹40 and ₹250 depending on targeting, city and season. Narrow B2B audiences sit well above that range.