When buying online ads, the price you pay for those ads is, usually, based on one of two things: CPC or CPM. But what are they? What’s the difference between them? Which one will be better for you?

CPC – Cost Per Click

The Cost Per Click payment model is, as the name implies, where you pay per click on your ad. It’s generally regarding as a “performance” payment model, because you only pay for direct audience interaction.

What’s it good for? Lead Generation

If you have a clearly defined lead or user acquisition strategy, CPC is likely a better way to go. This is because with CPC some of the “risk” is transferred to the ad network – if users don’t click on your ad, you don’t pay!

CPM – Cost Per Mille

With CPM ads, rather than paying for user interaction, you pay per 1000 ad impressions. Meaning, every time your ad is viewed 1000 times, you pay a set amount.

What’s it good for? Brand Building / Awareness

Keeping your product or brand top of mind with your target audience is another important marketing strategy and to this end, CPM is probably for you. While you can still get people to click on your ads, the emphasis is on reaching more people.

Track Everything

As with anything in digital marketing, tracking the performance of your campaigns is absolutely critical. It doesn’t matter what payment model your campaign is running, whether it’s CPC or CPM. Without this data you’ll be unable to assess your return on investment and therefore whether your campaign is working or not.

This is called “attribution”, and it’s an often overlooked area in digital marketing. But without it, you’re potentially throwing money away. Chances are you already have access to the tools you need to start building a pool of attribution data. Google Analytics is full of useful things for exactly this.

Experiments Are Good!

A little tip: if you’re about to launch a fresh ad campaign, with new creatives, copy and everything, start with CPM. This is a good way of quickly getting data on your ad’s performance, with minimal investment. Once you’ve optimized it and your click through rate has gone up, you can switch over to CPC.

Make That Landing Page Shine

Although this applies to both CPC or CPM, it’s especially key with the former. If you’re running a CPC campaign, making sure your landing pages are on point is key. You’ve paid for your audience to reach this page, don’t burn your budget by driving them away now! Your landing page should echo the ad they’ve clicked on and should contain everything they need to convert, there and then, ideally. There’s even tools and services out there to help you build better landing pages, make use of them!

Which one worked better for you? CPC or CPM? Let us know in the comments!

If you want to know more about CPC or CPM on the Adcash Advertiser platform, we’ve put together this handy Support Center articles for you:

6 Steps to create a campaign with Adcash – Support Center