In the performance marketing world, there’s often an overemphasis on efficiency metrics at the expense of effectiveness. Many marketers and brands focus heavily on CPMs (Cost per thousand impressions) as the north star for their media buying decisions.
But should this metric carry so much weight?
Understanding CPMs in Context
CPMs are fundamentally a measurement of audience efficiency – they help brands understand whether they’re reaching their target audience in a cost-efficient manner. This metric has become ubiquitous in advertising conversations and planning sessions.
However, there’s a critical distinction to make: CPMs should be viewed as an input to your media strategy, not the optimization factor that drives all decisions. They’re a means to an end, not the end itself.
Beyond Efficiency: The Effectiveness Gap
When evaluating media performance, the question brands should really be asking is: “Are we being effective, not just efficient?”
It’s entirely possible to have extremely efficient media that fails to deliver business results. You might secure the lowest CPMs in your category, but if those impressions aren’t driving the desired outcomes – whether that’s brand awareness, consideration, or conversion – then the efficiency is ultimately insufficient.
Rethinking Success Metrics
Instead of focusing solely on CPMs, brands should consider response-driven KPIs that directly connect to business outcomes. These might include:
- Cost per qualified search query or lead
- Incremental revenue generated
- Customer acquisition costs
- Return on ad spend
- Brand lift metrics
By incorporating these outcome-based metrics, brands can develop a more holistic view of performance that goes beyond simple efficiency measures.
Building a Balanced Scorecard
Successful performance marketing requires a balanced scorecard approach where CPMs are just one of many inputs considered. This more comprehensive framework acknowledges that different channels and tactics serve different purposes within the customer journey.
For example, some high-CPM placements might deliver exceptional value because they reach a highly qualified audience or appear in premium environments that drive higher engagement and trust. Conversely, rock-bottom CPMs might be delivering impressions to audiences with no interest in your product or in contexts that harm brand perception.
Moving Forward: From Efficient to Effective Media
The path forward for innovative and growth-oriented brands involves shifting focus from merely efficient media buying to truly effective media strategies. This means:
- Establishing clear business outcomes for every campaign
- Building measurement frameworks that connect media activity to those outcomes
- Optimizing toward the metrics that matter most to the business
- Understanding the appropriate role of efficiency metrics like CPMs
By taking this more methodical approach, brands can ensure they’re not just getting the cheapest media, but media that actually works to build the business and the brand.
In a world of increasingly complex media ecosystems, the brands that thrive will be those that look beyond simplistic efficiency metrics and embrace a more sophisticated understanding of media effectiveness. The question isn’t “How can we get the cheapest impressions?” but rather “How can we ensure every impression contributes meaningfully to our business goals?”
