What is CPM and How Does It Work?
CPM stands for Cost Per Mille (Mille is Latin for thousand). It is a standard advertising metric that represents the cost an advertiser pays for every 1,000 impressions of their advertisement on a video. For YouTube creators, CPM is an important indicator of how valuable their audience is to advertisers.
The CPM Formula
To calculate CPM, use the following formula:
CPM = (Total Ad Revenue / Total Ad Impressions) * 1000
Example Calculation
If your video generated $500.00 in ad revenue from 100,000 ad impressions, your CPM is:
($500 / 100,000) * 1000 = $5.00 CPM
Frequently Asked Questions
What is the difference between CPM and RPM?
CPM measures the cost an advertiser pays for 1,000 ad impressions, whereas RPM (Revenue Per Mille) measures the total revenue a creator earns per 1,000 video views, after YouTube's 45% revenue share cut and including other revenue streams.
Why is my YouTube CPM fluctuating?
YouTube CPM rates vary depending on seasonal advertiser demand (higher in Q4), viewer location (higher in tier-1 countries), video topic, and audience demographics.