What is CPC and CPM?

What is CPC and CPM?

When advertising or publishing in the digital world you normally come across these two terms which can be defined as follows.

CPC or Cost per Click is the cost an advertiser is willing to pay for a visitor to his web property. The visitor to a site can come from an Text Ad or a Image Ad. Advertiser pays this CPC to the website from which he gets the customer. 

CPM or Cost per Thousand Impressions is the cost which an advertiser pays to a publisher for every 1000 views his Image Ad gets on the web property of the publisher.

CPC V/s CPM

There are many discussions which have happened over the two and majority of the web community has come to conclusion that you should use CPC when an advertiser has objective to drive sales or get customer data such as Name-Contact Number-Email Id. The best approach to such a process is to have well designed Landing Page which provides good information to a visitor to obtain the desired results. CPM on the other hand is a very useful technique for Brand Building. When declaring your online presence to the world Image Ads have been proven to be most cost effective. They have minimal click through rate ensuring lower cost of brand recall.

There are various advertising platforms run by Internet giants such as Google, Microsoft & Yahoo which act as a mediator between and advertiser and a publisher. While advertising platforms provided by Social Giants such as Facebook, LinkedIn and Twitter are only for advertisers as they themselves are the publisher of the ads.

What is Google Adsense?

Google Adsense

Google AdSense is a program run by Google that allows anyone with a website or Video Content on Youtube having decent number of visitors to earn revenue online through display of text and image ads. It allows anyone with a website on any subject, general information, product or service to rent out part of space on his website. 

Any example of an Google advertisement placed on a website by a website owner is as follows:

Google Adsense Text Ad Example 1:

Area marked in blue on the right side of the webs page is a Google ad on a site below which provides Emotional Quotes to internet users.

Google Adsense Text Ad Example 2
Area marked in blue on the left side of the web page is a Google ad on a site below which provides Emotional Quotes to internet users.

Google Adsense Image Ad Example

A image ad from a hosting service provider can be seen on a site based on Car Insurance

How much does Google Adsense pay to show an advertisement on a website and a Youtube Video?

Google Adsense shares 68% of the revenue with a website or Youtube Video owner for showing an ad around the content.

Does Google Adsense pay to show an ad or when some one clicks on the ad?

Google share revenues with the publisher(owner of the content be it website or youtube video is called a publisher) on Per Click basis and Per Impression basis. So even when visitors are not clicking on advertisement around your content you earn revenue on per impression basis.

What is CPC and CPM?

CPC stands for Cost per Click - It is the cost which Google Adsense pays you when a user clicks on a ad on your website.

CPM stands for Cost per Impressions or Cost for showing an advertisement for 1000 times. Every visitor count seeing the ad is counted as 1 impression.