5 Factors That Determine Your Advertising CPM Rates - Zibtek Blog
5 Factors That Determine Your Advertising CPM Rates

5 Factors That Determine Your Advertising CPM Rates

It is quite tricky to pull out cross-site ad monetization data unless you are working with an ad agency. Gaining access to the detailed statistics is virtually impossible for people without specialized tools and expert knowledge. For people who are looking at online advertising from the outside, CPM, the cost for every thousand impressions, may seem like a big black hole.

 

5 Important Factors of CPM

 

What exactly affects your CPM rates? Most people do not know what exactly they need to consider. It is wise to keep an eye on the website and estimate the CPM accordingly. Listed below are five factors or questions that you need to ask yourself initially:

 

  1. is your website sticky enough or is just a one hit wonder? In other words, do people have a reason to regularly visit your site for new information or experiences?

 

  1. Who exactly is using the website? Is it just people in the US or people all around the globe?

 

  1. Is it a generic website or does it have a niche or a category? Have you honed your market to a specific target audience?

 

  1. Is there a dependency on Google SEO to bring in the visitors or is there a dependency on a community site to bring people back?

 

  1. How many page views does your website have in general? Is it thousands a day or just a few?

 

If you spend some time answering these questions, you will know how to assess your website better. It will provide you with great insights and help you to take the necessary steps.

 

Factors that affect the CPM rates.
Factors that affect the CPM rates.

Difficult or Easy to Monetize

 

The simplest way to monetize:

 

Many US-based websites are in a specific niche and are one-hit wonders. If your website has a very high click-through rate (CTR), it means the visitors to your site are in transactional mode. If this is the case, you are one of the businesses that has a lot of page views. It only says that you are going to make a lot of money in the form of cash.

 

How Is It Difficult to Monetize?

 

Almost all websites that are sticky are websites based in the US and Europe in general. They usually have a tremendous amount of page views. People generally in this type of setup are unlikely to buy anything. Even if they do, it is not going to be a considerable amount, and, therefore, it is less likely for you to make a lot of money.

 

Category Examples For Your Reference:

 

Here are some interesting statistics that show you the approximate rates of conversion and monetization:

 

International sites that are large have <$0.50 CPM.

 

If the social media sites do not have any direct ad sales team in place, they have <$0.25 CPM.

 

Medium websites that primarily use banners and network have <$1 CPM.

 

Niche reference sites might have > $5 CPM or higher. It mainly depends on the kind of niche that they are running.

 

If we focus on old-fashioned advertising methods, the numbers will be more likely to be less or at the bottom of the range for these sites. There might be specific social networks that may be quoting around $20 CPM, but in reality, only one percent of a business’s inventory will sell at that rate. The remaining 99% can be sold only at <$ 0.25.

 

Your website can fall into one of these two categories:

 

  1. Horizontal Websites: These are the sites that people may use daily. Though it may have low CPM, it has a considerable number of page views.

 

  1. Vertical Websites: These are the sites that capture the intent of the user. People use these sites intermittently. A lot of the traffic comes from search. Though they have a low number of page views, they can create a high CPM.

 

In the case that horizontal sites scale up to become a large enough website, they will be able to employ a direct ad sales team. Now, this can result in rising the CPM dramatically. This process, however, is demand inhibited.

 

Google is one website that is not just horizontal but is also vertical. Despite being used every day by various users, it is also a website that is able to predict user behavior and drive sales through various channels.

 

Social Networks Monetize Badly

 

If a website has too many page views, it is sticky. While it may contain a lot of information, it may be having less social content.

 

Small Sites Versus Large Sites

 

There is a notion that is prevalent that smaller websites have the capability of monetizing better than the ones that are large. While it is a correlation, it might not be causation. Hundreds of sites that are out there get most of their traffic from Google. Building a social site wherein people return every day is something that is tough to create.

 

But creating a website that people can stumble upon using a search engine like Google is something that is doable. Having looked at some of the factors that affect CPM, you can better strategize for your business website’s success.

 

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