When running ads online for your business you’ll likely be offered a few different options for your payment method. Typically these are CPC and CPV but there are a whole host of ever-so-slightly-different variations on these categories. All of them follow the Cost Per ‘X’ pattern so ad payment acronyms are an indistinguishable haze of CPs (how terribly helpful). Lucky for you today’s article is aimed at drawing out the differences and giving you an understanding of what the optimum use is for each. Lets get started!

CPV & CPM

Cost per View and Cost per Thousand Views (the ‘M’ comes from ‘Mille’, the Latin for thousand). The traditional way of doing ad cost calculations on TV, radio and co. It predates the internet’s marketing supremacy and is still the most common form of marketing you’ll find online. In this billing, you’ll be charged each time your ad is seen.

Due to you paying out each time the ad is run, regardless of any action or interest on the viewers part, these are better for raising general brand awareness or a public information campaign – something you just need people to see.

CPC

A familiar friend from our Pay Per Click marketing article. CPC is your Cost per Click – how much you pay every time someone is interested enough to click your ad.

As the linked article points out, it’s great if you have the time to curate an effective keywords list but the fact you’re still paying out without a guarantee of action from the viewer can become a money sink if you aren’t careful.

CPA

Cost per Action (or Acquisition). These schemes are more difficult to get a hold of in the first place. Google requires you have a reasonably effective PPC campaign underway before providing it as an option. After all, they don’t want to direct traffic to any old mess of a site.

The exclusive nature comes from the fact that you will only be paying when someone takes a specific action of your choice – typically buying a product, signing up to a service etc. Great for those of you hoping to use a campaign to up online sales, for instance, but obviously requires some initial skill and effort to acquire in the first place.

CPL

The last of our ad payment acronyms is Cost Per Lead. In a CPL agreement you pay per ‘Lead’ you receive on a potential customer. Usually this is something like signing up to a mailing list.

Sounds similar to CPA doesn’t it? The difference is largely in the timing. Where CPA is frequently used when pushing an immediate response, a CPL campaign is typically lightweight – desiring only the email address of the viewer – with a view to obtaining sales/conversions at a later date.

It’s a great tool to build a database of contact information for an EDM (Electronic Digital Mail) marketing campaign, for example.

By the way, if you’re interested in hearing more about an effective EDM campaign in this renaissance age for email marketing you’ll want to check out next week’s article over at our blog!