Human beings spend most 50 per centum of their day’s time online, visiting websites, emails, social media etc. With that, we are likely to see ads (image/text/video). Online advertisements mean to drive profits through ad posting, in websites or social media.
There are the two important ways, which admans could use to drive dealings/visibility to their website, i.e. Cost per Click (CPC) & Cost per Impression (CPI). Let’s learn about them one by one with examples.
Cost Per Click (CPC)
Also called Pay per Click (PPC), this is an effective method of online advertising. Here, the adman pays money supported the number of clicks on the advertisement. You need to consider a couple of things before choosing this strategy, as the clicks would mean an fundamental interaction between potential clients and your company. You are paying exactly for this so you need to consider:
How much you are paying?
The type of attention you are going after?
The value you are receiving?
The adman pays money to publishers contingent a formula or a bidding process. Publishers look for third party matches to find admans like Google AdWords or Microsoft Bing Ads. They contract with these companies which in turn have complex algorithms to calculate what type of dealings is coming from where. If the adman’s product matches the type of dealings then Bingo, there’s a match.
Once posted, the ads will remain on the website for as long as the adman has bid to pay. For example, if a website’s CPC rate is 1 INR, 100 clicks would mean100 INR (1 x100). Depending on the bid, the adman has to pay.
Cost Per Impression (CPI)
This is alias Cost per Thousand Impressions (CPM) where M stands for Roman numeral 1000. This is the rate an adman has united to invite every thousand-fold the ad is viewed. Basically, every appearance of the ad to users counts as impressions. The price is set supported every 1000 views. Only views, not clicks matter here.
The ad servers monitor the impressions and adjust the display rate to match an adman’s spending. CPI’s pricing representation is similar to it of written ads.
For example, if a publisher charges 10 INR CPM, the adman has to pay 10 INR for thousand views. Simple, isn’t it! Usually, large websites use CPM to sustain a stable visibility of their product. A publisher prefers this because they are acquiring paid only for the views and not clicks.
Which one to prefer?
Well, it mostly depends on your gross sales. If gross sales are good and the ad isn’t effective, then CPC is your friend. The clicks match you with potential customers/clients. But, if ads are good but gross sales, not so lovely, CPM would help get some viewers likewise as clicks (imagine 100 clicks per 1000 views). This could work great as the views could get you clients.
Therefore, CPC and CPM are two sides of the same coin. Both have promising results and drawbacks. It mostly depends on your marketing schemes. Also, optimizing ads supported performance would be excellent, like you could change ad texts, image parts, ad positions etc. These things do have a strong effect on the viewers.