CPM: What it is and how to use it to gain more visibility with your e-commerce shop

When there’s a new brand in the market within your sector, you have two options:

1. Incorporating it into your catalog right away to try to get ahead of the curve with it (even if you risk keeping your stock inactive for a while, unless you use dropshipping for your sales).
2. Wait until it becomes more popular so as to keep your clients, even if it means more competition.

I bet you’ve faced this dilemma with your online shop.

What you may not know, however, is that there’s a middle option: CPM ads.

CPM advertising is a model that allows you to get your clients acquainted with the new brands in your catalog to help you start selling much faster.

If this sounds right down your alley, read on, because we’re going to tell you:

• What CPM is and what makes it different from other advertising models.
• Pros and cons of using it in your campaigns.
• Tips to increase your ads’ profitability.

Visibility, here we come. 😉

👉 What CPM stands for and why it could be useful for your e-commerce shop

CPM is the acronym for “Cost Per Mille” (Cost Per Thousand).

That is, campaigns in which you pay a specific price for every thousand times your ad is displayed.

CPM campaigns are particularly useful for companies that want to strengthen their position in the market or that want to make a name for themselves.

The main objective of this kind of ad is for the user to remember your brand or products, as opposed to clicking on them.

These are the platform where they’re displayed:

• Display Network Websites: All the small sites (mostly individual blogs or niche sites) that have signed up to Google AdSense to show ads from different companies.
• YouTube: You can also create video ads to be shown on YouTube through Google Ads’ Display Network (if interested, check out our guide on video marketing).
• Social Media Feeds: These are all those campaigns published via Facebook Ads or other sites (like Snapchat).

Generally speaking, these ads consist of an image or video accompanied by a CTA.

✅ Differences between CPC, CPC, and CPA

Before digging deeper into CPM campaigns, let’s take some time to spell out a few terms.

If you’ve had the chance to learn a bit about online advertising, you’ll probably already know the different payment models that exist and that CPC, CPM, and CPA stand out from the rest.

What you may not know so well is when to use one campaign model or another. 

So let’s find out:

• CPC (Cost per Click): Ads are optimized to get more clicks and attract traffic to your website. Here’s another post analyzing CPC in depth.
• CPA (Cost per Acquisition): The only goal of cost per acquisition is conversion. If you don’t make a sale, you don’t pay. It’s the most suitable one for consolidated products or affiliate campaigns.

As you can see, the best campaign type depends on your objectives.

CPC and CPA are focused on sales, whereas CPM campaigns aim to help you build strong brand awareness (to get more clients in the medium and long term).

👉 Pros (and cons) of CPM campaigns

CPM advertising will help you reach a higher number of potential clients so they know about your products and perhaps your online store.

But bear in mind that this model also has some drawbacks.

Before throwing yourself into campaign creation mode, you should be aware of the pros and cons.

✅ 1. Pro: A simple way of gaining visibility with your audience

Let’s first see the advantages this kind of campaign can bring to your e-commerce shop.

• It is low-cost branding: Online CPM campaigns are much cheaper than traditional ads in newspapers, on the radio, or on TV. Besides, they tell you the exact number of impressions you’ve gotten (so you know if the investment is worth it).
• It provides accurate segmentation: These ads are shown to interested audiences. For example, if you use Google Ads to sell gardening tools, your campaign will be displayed on blogs and websites for gardening buffs.

Moreover, even though it’s not very common, some advertisers also resort to CPM marketing when they want to get more clicks at a lower price than with a CPC campaign.

This could work if you create a flashy ad with an irresistible offer.

✅ 2. Con: Improving brand image doesn’t always mean more sales

The disadvantages of CPM are about the same as those of any branding campaign:

• It’s not focused on conversion: Can you increase sales through ad impressions? You can, but you shouldn’t expect a sudden flood of customers. The objective of this kind of campaign is to pave the way for prospective marketing actions.
• Success isn’t entirely up to you: You don’t choose the websites your ad will be shown on – the system does. If your ad is shown on a low-traffic web, the impact of the campaign won’t be as great.
• ROI is difficult to measure: Like in most cases, an ad’s impression doesn’t materialize in a conversion right away. It’s harder to establish KPIs that allow you to determine the real impact of your campaign.

Mind you, though, just because there’s no immediate return on investment doesn’t mean you can’t get much out this model. 😉

Let’s see how.

👉 5 tips to make your impression campaigns more profitable

Here are some ideas to reduce the CPM you’re paying and turn impressions into sales in the medium term.

✅ 1. Segment your audience properly

Display campaigns are usually segmented according to the interests of your buyer persona (in the case of the Display Network, you can also do it based on keywords).

And, as you know, the more precise your segmentation is, the more successful your ads will be since they’ll be reaching the right audience… But don’t overdo it. 😉

If you add too many criteria, your target audience will end up being too narrow, which will end up making your CPM more expensive.

Both Google Ads and Facebook Ads give you an estimate of the number of users your ads can draw in. They also notify you if you’re overdoing it on either side of the spectrum.

✅ 2. Create an ad that’s impossible to ignore

Users are getting more and more used to glazing over banners and ads in their feeds.

That means it’s crucial to create attractive designs that catch everyone’s eyes.

Here are some tips to do it:

• Include motion: Use GIFs or videos instead of static images. The eye is more sensitive to movement, so you’re more likely to grab a user’s attention. And then…
• Use copywriting: You hook them up with a persuasive message, one that aims right at their pain points (if you have any doubts, check out this post on copywriting for e-commerce).
• Add a concise CTA: To finish it off, tell the user what to do next (visit your website to learn more, place an order, get in touch with you, etc.).

These tricks will help you increase your ads’ CTR and reduce the cost per impression.

✅ 3. Design a global strategy

Advertising campaigns should be another part of your conversion funnel.

For example, these steps will help you promote a new brand you’ve included in your store’s catalog:

• Include relevant information on your landing page: After clicking on your ad, users will reach a product card or a landing page with more information about the brand. Even if they don’t buy, you want them to remember the product once they’ve left your site.
• Informative content: Once you’ve piqued their interest, the first thing they’ll do is look for more information on the Internet. Offer them this type of content through reviews and comparisons with other brands.
• Remarketing ads: The users that have read the comparisons and product cards on your website are almost ready to buy. The last step is to launch a remarketing campaign with a small discount to push them toward conversion (in this post we tell you how to create a remarketing campaign).

For more expensive products with a longer customer journey, you’ll need to combine these actions with an email marketing strategy.

✅ 4. Create different designs for each device

Is your conversion rate much higher on computers than on cellphones?

This may be a sign that your ad isn’t suited for small screens.

If this is your case, you can create an optimized version for each screen size.

✅ 5. Make variations and track the user responses

We can’t say it often enough: if you want to get better and better results, you have to keep trying new things, then rinse and repeat.

And that involves making changes to your ads to see which one works best (the renowned A/B tests).

Try different banners, change the CTA text and implement different variations to find the one that yields the best results.

👉 Ready to gain visibility with your CPM ads?

If you want to increase sales in your online shop, branding must be a fundamental part of your strategy.

When you position yourself as the go-to supplier of a brand, users will find you every time they try to find a product from that brand (even if there are another twenty e-commerce shops selling it too).

Now you know! Start creating your own CPM campaigns and put everything we’ve told you into practice.

See for yourself how they never forget you. 😉