Sunday, January 25, 2009

Putting the 'e' in CPM

Having recently spent a week in Las Vegas enjoying Affiliate Summit West, I had an interesting conversation that I thought might benefit some of our own publishers. It’s about the importance of “e” in eCPM. Most people that do any advertising are pretty familiar with what CPM, CPA, and CPC stand for. And I’m sure there will be a host of people which will defend the benefits of each one for being the best way to make money online. Fortunately when you enter the world of “eCPM” it doesn’t matter because at the end of the day it IS all about eCPM.

eCPM is really “effective CPM.” It means if you took all the revenue you made from CPM, CPA, and CPC advertising and adding them together to determine how much you are truly getting paid per 1000 visitors to your site. When evaluating any mix of advertising it’s always best to calculate your eCPM. I see CPA offers that garner $100 on a lead, while others $0.50. And while one may look more impressive than the other, it depends on how well it’s converting to determine which has a higher eCPM.

At WidgetBucks the same math applies since we mix both CPM advertising and CPC advertising. Since you’re able to earn revenue both in the volume of impressions as well as how many click through on the Shopping, Local, or Travel widgets, we boil everything together as your eCPM value. It is because of this performance companent that placement of widgets becomes essential to optimize your site visitors to earn you the most money. A widget placed in the footer of your site might receive a lot of impressions, however due to the placement will probably not have great CTR to lift the eCPM.

Thus when trying to evaluate the performance of your widgets, spend a moment to look at the Widget Detail tab and compare how your widget is performing both in CPM and CPC revenue and determine if changes should be made on placement or styles. Put the “e” back into CPM by letting WidgetBucks be more effective for you.

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