What is eCPM/ RPM in Google Adsense?

Google AdSense needs no introduction. Let me not explain it here and bore you guys. If you are new to it, catch the fundamentals here.

In this  Short Series Part 1, lets try to simplify eCPM and learn how to effectively increase your eCPM by the end of this short series.

 

What is eCPM ?

Definition : eCPM stands for Effective Cost Per Thousand Impressions – is the amount of revenue you earn from AdSense for every 1000 impressions that you show on your site.

  • eCPM = (Earnings / Page Impressions) * 1000

Well, let me make it more simpler by giving you few examples:

Eg 1 : If you get 10,000 page impressions and 200 clicks and earned $300, then your eCPM is $300/10,000 * 1000 = $30.

Eg 2: It you get 30,000 page impressions and 100 clicks and earned $500, then your eCPM is $500/30,000 * 1000 = $16.67 .

From the above, it is clear that eCPM is directly proportional to the revenue and inversely proportional to the ad impression.

So, now you know what actually the eCPM that appears on your Google AdSense account means !

Why eCPM is very important ?

  • eCPM is a primary factor that determines your earnings from AdSense.
  • It also helps you measure how well your ads are performing.

 

I now know eCPM. But I see something called RPM ? What is it ?

RPM – If you’re using the new interface, you’ll see that your reports now show RPM and not eCPM. RPM stands for Revenue Per Thousand Impressions. RPM is just another term for eCPM, and it’s calculated the same way as eCPM. AdSense now use these two terms interchangeably.

With this small introduction to eCPM, lets get to know few more important aspects related to it.

 

 

What are the factors that influence the eCPM ?

You guys have now known what is eCPM from the Part 1 of this Short Series.

In this part of the short series lets learn – What influences eCPM ?

eCPM is primarily influenced by 2 factors:

CTR : Click Through Rate – How often the users click on ads on your website?

CPC : Cost Per Click – How much an advertiser willing to pay to any given click ?

Click Through Rate (CTR) :

Among CTR and CPC, you can drastically influence CTR by placing ads on prominent positions on your website. The more prominent place you give, the more likely you are to generate a click.

  • CTR = Page impressions / Clicks

Cost Per Click (CPC) :

CPC is determined by how much the advertisers are willing to pay for that click which can vary based on the content.
Consider an example : You have 2 different types of content say one is related to diamond jewelery designs and other related to dog belts then, its much more likely that advertiser is going to evaluate diamond jewelery over dog belts and is willing to pay a bit more for it.

Having known what primarily influences the eCPM, next, lets know – ” How the web traffic impacts eCPM ” ?

 

 

How does web traffic impact eCPM ?

eCPM is very likely to be affected by the traffic your website receives. You just can’t simply compare your eCPM now and few years before because the traffic of your website would have significantly grown by now.

If you tend to receive more traffic form North America over Asia, then your more likely to get higher eCPM . If you ask me why? The answer is simple – Generally, cost per click is driven by the purchasing power of the advertiser in any given country. An advertiser of New York spends more on his advertising in comparison with an advertiser from India.

In the next part, lets look at one question that always taunts the AdSense publishers – What is the ideal or good eCPM ?

 

 

What is a good eCPM ?

This is the questions that runs through the mind of any serious AdSense publisher. What is a good eCPM ?

Revealing your eCPM is against the Google AdSense TOS, which I don’t want to do.

You should know that anyone is able to achieve a 5$+ eCPM if he has 500 impressions a day and happens to get 2-3 clicks that pay more then a few cent.

However on a scale of a million impressions or more 5$+ eCPM is a totally different thing.

I have seen websites with eCPM of $0.10 to $500 and it is very hard to find an explicit answer to – What is a ideal or good eCPM. A lot of people ask this question on web forums and other websites but thats not the way to go.

The first thing you need to know is that eCPM is just a quick and dirty way of comparing websites earnings.

Just because a website has eCPM of $7.00 doesn’t mean it makes more money then a site which has lesser eCPM, having said that, higher eCPM do signify higher earnings for fixed amount of impressions.

 

Just remember:

  • Always track your results on an Ad unit level.
  • Always try to optimize your Ad placements.
  • Always do test for at least a few days to see which change works best.
  • Never stop optimizing.
  • Work on bringing in more traffic because traffic = money.
  • Keep visiting technojourney.com .
  • Last but not least – be patient.


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9 Comments to What is eCPM/ RPM in Google Adsense?

  1. First Date Tips

    Hello, I log on to your blog daily. Your humoristic style is witty, keep up the good work!

  2. Hi.. I’m new to adsense. I haven’t get any revenue for RPM. i got only for clicks. I dont have any idea about this. 🙁 🙁

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