What Does “Cost Per Thousand” Means In The Advertising World?
The marketing and advertising industry can be a bit confusing to those outside the industry. With lots of jargon like OOH, dwell etc, it can be hard not to be overwhelmed. We like to keep things simple here at DrivenMedia, much like our advertising platform.
Before we start, let’s clear up what us advertising lot mean by “CPM” sometimes “CPT” depending on who you’re speaking with. Both mean “cost per thousand” and we’ll stick with the industry definition.
“A marketing term used to donote the price of reaching 1000 people, including all associated production costs.” Essentially the cost of the medium, plus all associated production costs, per 1000 people reached in your campaign.”
CPM is used as a comparison tool across different types of advertising. The lower the CPM the more people you can reach with your budget and the more cost effective the advertising is.
For our own data, we’ve used an average CPM of our launched campaigns over the last 12 months, using the campaign price our customers actually paid. These ranged from £0.21 to £1.23, giving us an average CPM of £0.75, looking at our figures the vast majority fell between £0.50 and £1, so we are confident this average price is accurate.
For our industries figures, we’ve used as recent as we can find on official trade body websites and materials and the most cost-effective is clear.
The graph above shows the average relative cost to reach a thousand people across common advertising mediums. The lower the amount the more cost effective the medium.
Understanding each medium is key, truck advertising is the most cost effective in the long term, because the longer you run the campaign the more people the costs are spread across and the media cost per month are low.
If you’d like to drive your advertising further and reach more people for less, then get in touch with the team. We will even compare your advertising to see how your advertising compares to the average industry CPM.