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What do the acronyms CPM, CTR, CPC, CPS mean in relation to web advertising?

April 26, 2017Acronyms Advertising CPC CPM CPS CTR mean relation web

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What do the acronyms CPM, CTR, CPC, CPS mean in relation to web advertising?

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CPM — Cost per thousand page impressions, usually meaning advertisement views by a surfer. CTR — Click through rate means the percentage of site visitors who click on a banner advertisement to go to the advertisers site — often around 1%. CPC — Cost per click refers to the averaged cost of a banner ad campaign per click. That is, the cost divided by the number of times a click through to your site occurs. Say the site you are advertising on charges $1000/month and the CTR is 1% of 100,000 ad views, then the cost per click is $1000/1000, or $1 per click. CPS — Cost per sale is the calculation for return on investment of the ad campaign. Using the above example, if you make 10 sales out of 1000 click throughs, then it has cost you $100 per sale which may or may not be profitable depending on the profit margin on each sale.