Basic terms used in online advertising – PPC, CPC, CPM, RPM, CPA, CPL

Advertising networks are companies that manage advertisements for different advertisers at publisher’s website. Publishers get commission for different type of actions that are performed for the advertisers. Based on this payment structure, certain terms are derived to understand the payment terms better. Followings are a list of certain commonly used internet advertising terms.

CPC

CPC or Cost per click is an online advertising model in which publisher or website owner get paid for every click that has been originated from their site to the advertiser’s site. CPC is also called as pay per click or PPC.

The best example of CPC network is Google adsense. If you place any ads of Google adsense in your blog or site then you will get paid for each click that visitors initiate from your site.

CPM or RPM or CPT

CPM is known as cost per mile. Some peoples are also using it as RPM or CPT i.e. rate per miles or rate per thousand impressions. CPM is an online advertising ad model in which publisher get paid for showing an advertisement. However, in this case the rate will not be on the basis of click. It’s based on per thousand or mile impression that the advertisement gets in publisher’s site.

For example; if you have placed ads from medianet then your advertisement rate will be based on RPM i.e. rate per miles. If 1000 visitors have visited your sites and seen the advertisement then you will get paid for it.

CPA

CPA is known as cost per action. It’s very commonly used in affiliate marketing where advertiser pay commission based on pre-agreed action that visitor has to perform. Publisher will get paid only if the visitor has been redirected from their website to perform the action.

For example; Advertisers may have an agreement with the publisher in which commission will be paid only when visitor fills out a forms or register into a database. If a visitor from publisher’s site clicks on the advertisement then he or she will be directed to advertiser’s site to fill out a form or to perform some action like providing details about an investment plan. Once visitors completed the form or provided information, publisher will get paid for it. Alternatively, CPA is also used as CPL, which stands for cost per lead.

CPS

CPS is known as cost per sale. If you have placed any affiliate marketing links in your site and your visitors click on that to buy a product from your partner’s site then based on certain percentage on sale price you will get your commission for sending a buyer from your site.

Commission can be a fixed amount also. But the objective is that you as a publisher will get paid only when sales have taken place.

CPV or PPV

CPV stands for Cost per Visit. Publisher or website owner will get paid per visit to the advertiser’s site. For example; if an advertisement has been shown for X Company then you will get paid when your visitors visit that X company’s site from your site. Similarly if it’s not viewed then publisher will not get paid for it.

In some cases you also get paid when user actually views those advertisements or based on impressions. Pop-ups, pop-under and interstitial ads will fall into this category.

Please let us know if any other terms that are been used and are not listed above. We will be very happy to explain it to you.

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