How to Calculate Cost Per 1000 Impressions (CPM) in BigCommerce

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As e-commerce businesses continue to grow, online advertising has become an essential aspect of their marketing strategies. Cost Per 1000 Impressions (CPM) is one of the crucial metrics used to determine the effectiveness and efficiency of online advertising in BigCommerce. In this article, we will explain what CPM is, why it is important, and how to calculate it in BigCommerce.

Understanding Cost Per 1000 Impressions (CPM)

Before delving into the details of how to calculate CPM in BigCommerce, let's start with the basics. CPM refers to the cost incurred by advertisers for every thousand impressions that their ads generate. Impressions refer to the number of times an ad appears on a user's screen, regardless of whether or not they interact with it. In other words, if your ad appears on a website or social media platform, and it is seen by a thousand users, then you will incur a cost for the thousand impressions generated.

What is CPM?

CPM is a metric that measures the cost of advertising per thousand impressions. It is an essential metric in determining the effectiveness and efficiency of online advertising campaigns. By measuring the cost per impression, advertisers can evaluate the ROI of their advertising campaigns and compare them with other channels.

Why is CPM important in online advertising?

CPM is a crucial metric for advertisers because it helps them determine the success of their advertising efforts. The cost per impression can be compared to other metrics such as click-through rate (CTR) and conversion rate (CR) to evaluate the effectiveness of different advertising channels. Understanding CPM can help e-commerce businesses optimize their advertising strategies and budget, increase their reach, and improve their ROI.

CPM is particularly important for businesses that rely on advertising to drive traffic to their website or online store. By understanding the cost per impression, businesses can make informed decisions about where to allocate their advertising budget. For example, if a business is running a Facebook ad campaign and a Google AdWords campaign, they can compare the CPM of each campaign to determine which one is more cost-effective.

Another reason why CPM is important is that it can help businesses improve their targeting. By analyzing the CPM of different segments of their target audience, businesses can identify which segments are the most cost-effective to target. This information can then be used to refine their advertising campaigns and improve their ROI.

Finally, CPM is important because it can help businesses evaluate the effectiveness of their ad creative. By analyzing the CPM of different ad creatives, businesses can determine which ones are the most effective at generating impressions and driving traffic to their website or online store. This information can then be used to create more effective ad campaigns in the future.

Setting up your BigCommerce store for CPM calculation

Are you ready to take your BigCommerce store to the next level? One of the most important metrics to track when it comes to online advertising is CPM, or cost per thousand impressions. By tracking your CPM, you can ensure that your advertising campaigns are effective and efficient. But before you can start calculating CPM in BigCommerce, you need to set up your store correctly to collect data. Follow these steps to configure your BigCommerce store properly:

Integrating Google Analytics with BigCommerce

The first step to track CPM in BigCommerce is to integrate Google Analytics with your store. Google Analytics is a web analytics service that tracks and reports website traffic, including the number of impressions generated by your ads. By integrating Google Analytics with BigCommerce, you can track all the key metrics that determine the effectiveness of your advertising campaigns.

But what if you're not familiar with Google Analytics? Don't worry, it's easier than you might think. Simply create a Google Analytics account, and then follow the steps on the BigCommerce website to connect your store with your Google Analytics account. Once you've done this, you'll be able to track all the metrics you need to calculate your CPM, including impressions, clicks, and conversions.

Configuring your BigCommerce store settings

Once you have integrated Google Analytics with BigCommerce, you need to configure your store settings to track CPM. Under your store's settings, go to "Marketing" and select "Advertising." Here, you can add your advertising campaigns and platforms and track their performance.

But how do you know which advertising campaigns and platforms to track? That's where your marketing strategy comes in. You should have a clear idea of your target audience, your advertising goals, and your budget before you start running ads. Once you have this information, you can create advertising campaigns on platforms like Facebook, Instagram, and Google Ads, and track their performance in BigCommerce.

Remember, tracking your CPM is just one part of a successful online advertising strategy. You should also be monitoring other metrics like click-through rate (CTR), conversion rate, and return on ad spend (ROAS) to ensure that your campaigns are delivering the results you want. By using the tools available in BigCommerce and Google Analytics, you can stay on top of your advertising campaigns and make data-driven decisions to improve your ROI.

Calculating CPM in BigCommerce

Now that you have set up your store to track CPM let's look at how to calculate it:

Identifying the total cost of your advertising campaign

The first step in calculating CPM is to identify the total cost of your advertising campaign. This includes the cost of producing the ads, the cost of distributing them, and any other expenses related to the advertising campaign. For example, if you have spent $1,000 on Facebook ads, that represents the total cost of your campaign.

Determining the number of impressions generated

The next step is to determine the number of impressions generated by your ads. This can be done by looking at the data collected by Google Analytics. The number of impressions will vary depending on the advertising platform and campaign. For example, if your Facebook ads generated 50,000 impressions, that represents the number of impressions generated.

Performing the CPM calculation

Once you have identified the total cost of your campaign and the number of impressions generated, you can calculate CPM using the following formula:

CPM = (Total cost of campaign / Number of impressions generated) x 1000

If we use the example values above, the CPM would be calculated as follows:

CPM = ($1,000 / 50,000) x 1000 = $20

Analyzing and optimizing your CPM

Calculating your CPM is just the first step. Once you have the CPM figures, you can analyze the results and optimize your advertising strategy accordingly. Here are some steps you can take:

Evaluating your CPM results

After calculating CPM, evaluate the results to determine whether the advertising campaign was successful or not. Compare the CPM to your ROI to determine if your advertising is profitable. A high CPM may mean that your ad is not generating enough clicks or conversions, in which case it may be time to rethink your advertising strategy.

Tips for lowering your CPM

If your CPM figures are too high, there are some steps you can take to lower them. These include adjusting your target audience, testing different advertising channels, and improving the quality of your ads. By continuously optimizing your advertising campaigns, you can lower your CPM and improve your ROI.

Adjusting your advertising strategy based on CPM insights

Finally, use the insights gained from calculating and analyzing CPM to adjust your advertising strategy. Use the data collected to identify the best-performing advertising channels, campaigns, and ads. By constantly refining your strategy, you can optimize your spend and maximize your ROI.

Frequently asked questions about CPM in BigCommerce

Here are some frequently asked questions about CPM in BigCommerce:

Can I track CPM for multiple advertising platforms?

Yes, you can track CPM for multiple advertising platforms using the same method outlined in this article. Just follow the steps above for each platform.

How often should I calculate and analyze my CPM?

You should calculate and analyze your CPM as frequently as you evaluate your advertising performance. This can range from daily to weekly or monthly, depending on the volume of traffic generated by your ads.

What other advertising metrics should I consider alongside CPM?

In addition to CPM, other advertising metrics to consider include click-through rate (CTR), conversion rate (CR), bounce rate, and return on investment (ROI). These metrics provide a holistic view of your advertising performance and can help you optimize your campaigns further.


Calculating CPM in BigCommerce is essential for optimizing your online advertising campaigns. By understanding the basics of CPM, setting up your store to track CPM, and regularly analyzing and optimizing your CPM results, you can improve your ROI and increase your e-commerce business's success. Remember to consider other advertising metrics alongside CPM to get a complete picture of your advertising performance.

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