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The cost per thousand impressions (CPM) metric enables marketers to make cost comparisons between these media, both at the planning stage and during reviews of past campaigns. [4] Marketers calculate CPM by dividing advertising campaign costs by the number of impressions (or opportunities-to-see) that are delivered by each part of the campaign.
Cost-per-click (CPC) is calculated by dividing the advertising cost by the number of clicks generated by an advertisement. The basic formula is: Cost-per-click ($) = Advertising cost ($) / Ads clicked (#) There are two primary models for determining pay-per-click: flat-rate and bid-based.
Cost per impression, along with pay-per-click (PPC) and cost per order, is used to assess the cost-effectiveness and profitability of online advertising. [1] Cost per impression is the closest online advertising strategy to those offered in other media such as television, radio or print, which sell advertising based on estimated viewership, listenership, or readership.
Flat rate also passes into advertising. Purchasing advertisements on websites such as Facebook, Twitter and YouTube is sold a flat rates on the size (with a surcharge for images and posts) and length of the advertisement (video costs extra). Advertising on YouTube pitches at a flat rate of $0.30 per view. [4]
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In certain cases, YouTube will pay creators a percentage of the advertising revenue for advertisements that are placed within and before or after videos. The approximate share of advertising revenue paid to the creators of monetized videos is reported to be 55%; in 2013, the average creator's income was estimated to be $7.60 per thousand views. [2]
Since CTR is an expression of relevancy of the ads to the user search, higher click-through rates are generally rewarded with a better quality score attributed to the ads, which in turns might lead to lower CPC, therefore incentivising advertisers to continually improve the relevancy of their ads. However, having a high click-through rate isn't ...
Cost per view video advertising. Both Google and TubeMogul endorsed this standardized CPV metric to the IAB's (Interactive Advertising Bureau) Digital Video Committee, and it's garnering a notable amount of industry support. [81] CPV is the primary benchmark used in YouTube Advertising Campaigns, as part of Google's AdWords platform.
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