When you move in the direction of making money from your blog or monetising your website, you come to know about some common terms used by the advertising networks such as Google Adsense, etc. Earlier, we have discussed about CPC i.e. Cost Per Click. Another important term in blog monetization is RPM. This post will give you a brief introduction to RPM and its calculation.
RPM stands for “Revenue Per Thousand Impressions.” This is a common metric term in online advertising and blog monetization programs that simply calculates the average revenue earned for every thousand ad impressions on a website, app, or any digital platform. RPM is typically expressed in the currency of the ad revenue being measured (e.g., USD, EUR, etc.).
It is often used by ad publishers, advertisers, and ad networks for showing the performance and monetization potential of their online advertising campaigns. RPM is used for offering insights into the revenue generated from a specific set of ad impressions and it helps evaluate the effectiveness of ad placements, ad formats, and overall ad performance.
You can calculate RPM, just like ad networks do it. It is the total ad revenue made over a given period is divided by the number of impressions the ad has got, and then it is multiplied by 1000.
Let show you RPM calculation in a formula:
RPM = (Ad Revenue / Ad Impressions) * 1000
This means if your website has generated $100 in ad revenue from 50,000 ad impressions, the RPM would be calculated as follows:
RPM = ($100 / 50,000) * 1000 = $2
This means the website earned $2 for every thousand impressions.
RPM is a calculated metric which can vary widely. The RPM variations depend on the ad network, the formats of ad, the traffic on the website, the quality of the website, market conditions and user demographics. It is an indicator for ad publishers and advertisers, using RPM they can easily know about the performance of the add and optimize it for better results.
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