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Which Is Better: CPM Vs CPA Vs CPC (Complete Guide)

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Which Is Better: CPM Vs CPA Vs CPC (Complete Guide)

CPM, CPA and CPC are distinct billing models used for digital advertising campaigns.

All three are unique own their own and provide a powerful way to get your online ad campaign started, you may be asking so which one sis best for me?

To get to that, I’m going to show you what each model is, how they differentiate from one another, and which model is most suitable for your purpose.

What is CPM

CPM stands for cost per thousand or mile (another term), the amount is based on impressions and the base unit is one thousand. The impression can be page views or page loads, so if your advert is at the bottom you may not actually have been seen, so is not a 100% sure way of gaining real eyeball impressions, but generally speaking this is not a concern.

Essentially, the amount of times your ad is displayed depends on how much you pay.

Img CC: Purple ads

What is CPA

Cost per action, on the other hand, is a model where the advertiser only pays when a user views the advertisement, clicks on it and performs an action on the site. This action is usually a purchase, but sometimes registrations are also taken into account, as they help increase the database of leads or potential clients.

People use many choices for metrics in this area such as a sign up to a newsletter (CPA), an actual sale (CPS) or similar and the terms used will primarily depend on what the action is primarily.

Img CC: Purple ads

What is CPC

CPC (Cost per Click), also known as PPC (Pay Per Click) is a billing model where you only pay when a user clicks on your ad, not for impressions as you would with CPM.

The cost per click, also known as pay click, is one of the most commonly used online marketing methods used to direct traffic to websites, including the website owner being advertised by advertisers on that website. You get paid after clicking an advertisement from. Sometimes a click is considered as the amount spent on an advertisement.

Img CC: Purple ads

Conclusion

All billing strategies have their benefits and drawbacks. They’re similar, but each can be used for different campaign goals.

Whichever billing model you chose for your next advertising campaign, effective usage of CPI, CPL, CPA, CPC, and CPM requires an understanding of ads’ performance, audience preferences, and unique specifics of marketing for your business. You would need to keep an eye out for campaigns progress, monitor and analyze your result to make adjustments in time.

Depending on the objectives of your campaign and the size of your budget, a combination of all several strategies may also be best.