CPM vs CPC vs CPA vs CPI: Pricing Models Explained

CPM, CPC, CPA and CPI are the four ways an advertiser can pay for an ad: per thousand views, per click, per action (a sign-up or purchase) or per app install. As a publisher you are paid out of whichever one the winning advertiser chose, and your dashboard then flattens all four into a single number, eCPM or RPM.

That flattening is why the acronyms matter even though you never pick one. A site that lives on clicks behaves differently from a game that lives on installs. Knowing which model is paying you explains why earnings jump around, why one placement pays ten times another, and why tricks that raise clicks can end with a banned account.

This guide covers what each model means from the buyer's side, how to convert between them with real arithmetic, and what that tells you about your own numbers. The dollar figures come from our benchmark estimates (modelled, not measured), and every worked example is labelled as an example with its assumptions stated. The eCPM guide already covers the basic formula, so we keep that part short here.

The four models side by side

Each model puts the risk on a different party. Under CPM the advertiser pays whether or not anyone cares. Under CPI the advertiser pays only if the ad produces a customer.

"Publisher side and network" needs a note. When a buyer pays per action, nobody earns anything until a user acts. The network or exchange absorbs that wait and works hard to put the ad in front of people likely to act, which is why those ads can swing from lucrative to nothing on the same slot.

A fifth label turns up in video: cost per view (CPV), where the buyer pays when someone watches or interacts with a video ad. Google's own bid strategy overview lists CPC, CPM, viewable CPM and target CPA as separate options for advertisers, which gives a feel for how many ways a single buyer can choose to pay.

CPM: paying for exposure

A CPM bid is the price for a thousand impressions. If an advertiser bids $4.00 CPM, each impression is worth $0.004 to them, and a thousand cost $4.00 regardless of clicks.

Brand advertisers like this model because their goal is to be seen, not to get an immediate click. A refinement is vCPM, where the advertiser pays per thousand viewable impressions. In Google Ads, vCPM bidding is described as a manual strategy for awareness goals, with the buyer setting the most they will pay per thousand viewable impressions on the Display Network.

For you, CPM demand is the steadiest kind. It does not care whether your readers click. That makes it friendly to content where people read, scroll and leave, and it is the reason a high-traffic news page can earn properly without ever producing a click. The flip side is that CPM demand is where viewability matters most: an ad that loads below the fold and is never seen is worth less to a buyer who is paying for exposure. Fast pages and slots that stay on screen are the usual fixes.

CPC: paying for attention

With CPC the advertiser sets what a click is worth. AdSense puts it plainly: the CPC for any ad is determined by the advertiser, and some advertisers will pay more per click depending on what they are promoting. A lawyer's click is worth far more than a phone-case click because a single client is worth far more.

Your earnings from clicks follow a simple chain: impressions, times click-through rate, times the price of a click, times your share. An example with assumed numbers: 100,000 ad impressions, a 0.6% click-through rate and an average CPC of $0.30 to the advertiser. That is 600 clicks, so $180 of advertiser spend. If the network keeps a third and passes on two thirds, you receive about $120. In eCPM terms the buyer paid $1.80 per thousand impressions and you received about $1.20.

Two things stand out.

First, CPC income is the most sensitive to topic. That is the entire logic behind high CPC niches. Second, CPC is the model that tempts people to behave badly. Clicking your own ads, asking friends to click or nudging readers towards a slot with arrows and labels is exactly what the invalid traffic rules exist to stop, and the penalty is lost earnings or a closed account. A clean 0.6% beats a doctored 3% every time, because the doctored number gets clawed back.

CPA and CPI: paying for results

Cost per action and cost per install push the risk onto the traffic source. The advertiser names an outcome, such as a completed registration, a first purchase or a game install, and pays when it happens.

The name hides a wrinkle, though. CPA is sometimes a billing model and sometimes just a target. In Google Ads, target CPA is a Smart Bidding strategy that aims for a chosen cost per action, and the same page notes that conversion tracking must be set up for it. The advertiser is steering toward a cost per result while the platform still handles the auction. On Apple's side, a campaign is billed per tap, and the CPA figure in reports is total campaign spend divided by the taps that led to installs. The metric describes what the buyer got, not what was invoiced.

True pay-per-install billing does exist. Unity's documentation says its install-type campaigns are charged for installs attributed to the campaign, so "you only pay for converted installs". There is also a fallback: a campaign that accrues more than 10,000 impressions with no installs in 24 hours is converted to CPM billing, so a CPI campaign that is not producing installs does not simply serve for free.

Rewarded video is a natural home for install demand, because a user who has just watched a full video for a reward is a plausible prospect for an advertised game. In our modelled AdMob figures for Tier 1, rewarded is $12.00 per thousand impressions against $0.90 for a banner. Buyers paying for outcomes rather than exposure are one plausible reason for a gap that wide, though our tables do not isolate it. See the rewarded or interstitial comparison and the rewarded format page for how it plays out.

Converting between the models

All four collapse into the same unit. The key is that every model can be turned into advertiser spend per 1,000 impressions, and everything after that is arithmetic.

• CPM: spend per 1,000 impressions is just the bid.
• CPC: 1,000 x CTR x CPC.
• CPI: 1,000 x install rate per impression x CPI.
• CPA: 1,000 x CTR x conversion rate x CPA.

Here are three advertisers whose campaigns happen to land on the same revenue (assumed rates, for illustration).

For a CPA campaign, chain the steps. Say a retailer pays up to $15 per purchase, 0.8% of impressions are clicked and 2% of clicks end in a purchase. The click value is 2% x $15 = $0.30, and 1,000 impressions produce 8 clicks worth $2.40. The retailer is effectively paying a $0.30 CPC, though they never wrote that number down.

Now take the advertiser's cut out. A network passing on two thirds of that $2.00 puts $1.33 in your pocket per thousand. On AdSense, Google states that when advertisers buy display ads through Google Ads, publishers keep about 68% of the revenue, which you can check in your account under Account > Settings > Account information. Other networks do not publish their cut, so treat any share you see quoted as unverified.

Running the numbers backwards

The same formulas answer the question "what would it take?" Work backwards from a target eCPM and you see how demanding it is.

Suppose you want $6.00 per thousand impressions from a CPC-only setup at a $0.40 CPC. You need 15 clicks per thousand impressions, which is a 1.5% click-through rate. That is a high bar, and trying to engineer it is exactly where sites get into trouble. Run the same target through a $3.00 CPI and you need 2 installs per thousand impressions, a 0.2% install rate. That is still a high bar, but it asks for a user to try something new, not for a click that was never intended.

You can also test a benchmark against reality. Our modelled AdMob rewarded eCPM for a Tier 1 Android audience is $12.00. If the buyers behind that were mostly paying per install and 3 of every 1,000 impressions ended in an install, the implied average CPI would be about $4. That is an illustration, not data: real mixes include CPM and CPA buyers, and the share kept by the network changes the answer. But the exercise shows why a buyer who values an install at $1.50 would struggle to win rewarded inventory, and why your best slots go to whoever can afford the highest value per user.

The mobile eCPM benchmarks show the ranges by format. To see the maths with your own traffic, use the AdMob revenue calculator for apps or the AdSense revenue calculator for sites.

Why your dashboard says eCPM whatever the advertiser paid

Ad platforms need one comparable number, and revenue per thousand impressions is it. The AdMob glossary defines eCPM as an estimate of the revenue you receive for every thousand ad impressions, calculated as total earnings divided by impressions, times 1,000. That is why a click-based ad, a view-based ad and an install-based ad can sit side by side in one column.

On the web you meet a cousin, page RPM. AdSense calculates it by dividing estimated earnings by page views and multiplying by 1,000. A page with four ad slots shows four impressions per pageview, so page RPM runs higher than any single slot's eCPM. Our website RPM by niche guide has the tables, and the AdSense pay per 1,000 views guide works through a concrete case.

Both numbers are estimates until the network finalizes them. The AdMob glossary notes that estimated earnings can change when earnings are verified at the end of each month, and the invalid traffic guide explains one common reason for a downward adjustment. If your report shows a good week followed by a lower final figure, start there. Reading the AdMob report shows where to look.

What each model means for how you build

For apps, CPI and CPA demand rewards placements where the user is engaged and willing to try something new. A rewarded video offered at a natural pause, such as after a failed level, is a better environment for an advertiser than a surprise full-screen ad, and the player chose to be there.

For sites, CPC demand rewards relevance. Ads that sit near content a reader is already engaged with, in a topic advertisers care about, earn more per click, and the advertiser-side valuation of the topic matters more than anything you change in layout. CPM demand rewards viewability and traffic quality, so fast pages and ad slots that stay on screen earn more per thousand.

Geography cuts across all of this. Advertisers value a US user far more than a user in a low-income market because the user is worth more to them, whichever pricing model they use. The country tables show how the same ad format is modelled differently by market, and our methodology page explains the multipliers.

Fill matters too. A model that pays only on results needs a lot of advertisers competing, and a slot that stays empty earns nothing under any of them. The fill rate guide explains how to see that in your own numbers.

Common questions

Which model is best for a publisher?

None, because you do not choose. The demand side picks, and what you can control is the quality of the audience and the slots. CPM demand does not depend on clicks, so it suits high-traffic pages where people read and leave. If your content is about something advertisers pay a lot to be near, CPC demand can be worth more.

Why does my CPC drop while my eCPM rises?

They measure different things. CPC is the price of one click and eCPM is revenue per thousand impressions. If click-through rate rises or more CPM demand enters the auction, eCPM climbs even when each click is worth less. Look at CTR, CPC and impressions together before concluding something broke.

Is CPA better than CPC for advertisers?

Not by default. CPA ties spend to results, which lowers the buyer's risk, but it needs conversion tracking to work. Advertisers choose whichever lets them hit a cost per customer they can afford.

Why do I see eCPM in AdMob when advertisers bid on installs?

Because the report converts every impression's income to an effective rate after the fact. The AdMob eCPM figure does not tell you whether the underlying purchase was a view, click or install, only what the impression earned.

What to do next

Pick one placement and write down its three numbers for the last 30 days: impressions, click-through rate and eCPM. If you run an app, open the format breakdown in AdMob and compare rewarded, interstitial and banner. If you run a site, open the AdSense Reports page and compare page RPM with impression RPM.

Then check the shape. If clicks are doing most of the work and your CTR looks oddly high, look at your placements before looking at your advertisers. If eCPM is low and CTR is normal, geography or format mix is a better suspect. The formula guide shows how to turn what you find into a monthly forecast, and the programmatic advertising guide explains how the auction behind all four models actually runs.