Viewable Cost Per Mille: vCPM Explained

In online marketing, the acronym CPM stands for “cost per mille,” which translates to cost per thousand impressions (mille being the Latin word for thousand). CPM is a common advertising metric where an advertiser pays a predetermined amount for every 1,000 times their ad is served to a user, thus generating an impression. CPM is often used in campaigns focused on brand awareness, and to measure the impact ads have when reaching large audiences.

vCPM is a more precise and actionable metric than basic CPM. It stands for “viewable cost per mille,” which is to say the price a marketer will pay for 1,000 ads that are actually seen by people online (or on an app), not just the people to whom it was served. vCPM is actionable because when you know your ads were actually seen, you can track their actual efficacy, or the lack thereof.

Understanding Viewable Cost per Mille

With so many different metrics (and terms) to keep a handle on in the marketing world, it can get confusing quickly. I’ll break down vCPM in a step-by-step way to help you understand it:

How Does vCPM Differ From Standard CPM?

Think of it like this: A bus with an advertisement for a local dentist drives by a busy street corner on which 15 people are crowded, waiting to cross when the light changes. Ten of the people are looking at their phones, one is staring at the clouds, and four see the ad on the side of the bus. That’s 15 people to whom an ad was served, but only four actual views.

Why Is Viewability an Important Metric in Display Advertising?

Viewability is a crucial metric in online display advertising because it’s the measure of whether an ad is actually seen by the intended audience, ensuring that advertising spend is not wasted on impressions that have no chance of being noticed. If an ad isn’t viewable, it cannot deliver its message, rendering the impression ineffective.

How Viewability Is Measured

vCPM is not a one-size-fits-all way of tracking ad service and performance, so again I’ll go step-by-step. And, a quick note: Often ads that count as “viewable” were not necessarily actually seen by human eyes, but the chance they were is good enough for them to cross the bar.

What Are the Industry Standards for an Ad to Be Considered “Viewable?”

An ad is generally considered “viewable” if at least 50% of its pixels are visible to the user for a specific duration, typically one second for display ads and two seconds for video ads. This standard, defined by industry organizations like the IAB (Internet Advertising Bureau) and MRC (Media Rating Council), aims to ensure that advertisers are paying for impressions that are actually seen by their target audience.

What Technologies and Methods Are Used to Track Ad Viewability?

Ad viewability is tracked using a combination of technologies and methods. These include things like JavaScript libraries, ad verification tools, and industry standards like the Open Measurement SDK (OM SDK). Key techniques involve measuring pixel geometry, page geometry, and scrolling behavior, as well as leveraging server-side measurement.

How Do Different Advertising Platforms Report on Viewability Metrics?

While different advertising platforms utilize somewhat different methods and standards for reporting on viewability metrics, they generally focus on the percentage of impressions that are deemed “viewable.” As explained above, viewability is often measured as a percentage of total impressions that meet specific criteria for being in view, typically a minimum of 50% of the ad being visible for a certain duration.

Benefits of Using vCPM Bidding

vCPM bidding offers several advantages for advertisers by focusing on viewable impressions, leading to a better understanding of an advertisement’s effectiveness and improved ROI (return on investment). It allows advertisers to pay only when their ads are actually seen, reducing waste and ensuring campaigns are reaching the intended audience.

Why Would Advertisers Choose to Bid on a vCPM Basis?

Advertisers choose viewable cost per mille bidding when their primary goal is brand awareness or exposure, rather than immediate conversions or sales. It allows them to set a maximum price they’ll pay for each 1,000 times their ad is actually seen, not just displayed. This is particularly useful for new product launches or campaigns targeting a wide audience to build brand recall.

How Does vCPM Help Ensure That Advertisers Only Pay for Ads That Have a Chance to Be Seen?

vCPM helps ensure advertisers only pay for ads with a chance of being seen by defining a “viewable” impression as one where at least 50% of the ad is visible on the screen for at least one second for display ads, or two seconds for video ads, as noted before. This contrasts with traditional CPM, which pays for every impression, regardless of whether it’s actually seen by the user — or very likely seen, at any rate.

The vCPM model incentivizes publishers to place ads in viewable positions and rewards them for impressions that are actually seen by users. The overall effect is an improvement in display campaign efficiency and ROI by ensuring ads are actually seen by the target audience, leading to more effective engagement and better budget allocation.

However, vCPM is not available for all types of display ads. Specifically, it is not available for Search Network only campaigns. vCPM is primarily used for display and video ads, particularly within the Google Display Network.

Considerations and Potential Drawbacks of vCPM

Is vCPM Always the Best Bidding Strategy for All Campaigns?

vCPM is not always the best bidding strategy for ad campaigns. It’s most effective for campaigns focused on brand awareness and visibility, where the goal is to increase the number of people who see the ad. It’s less suitable for campaigns that prioritize conversions or clicks, as vCPM focuses on viewable impressions rather than user engagement.

How Might vCPM Impact Ad Inventory and Reach?

Focusing on viewable cost per mille can impact ad inventory and reach by focusing on the visibility of ads rather than just their placement. This can lead to a more valuable and impactful ad inventory, as users are more likely to engage with ads they can actually see.

Are There Potential Discrepancies in Viewability Reporting Across Different Platforms?

Discrepancies in ad viewability reporting across different platforms are a common issue in the digital advertising world. This is due to various factors, including different methodologies for measuring viewability, variations in impression counting practices, and the use of different tools and technologies.

What Are Some Factors That Can Influence Ad Viewability?

Many factors can impact the viewability of ads, including ad placement, page load speed, user behavior, ad size, and device type. Ads placed “above the fold” (visible without scrolling) and larger, vertical ad units generally have higher viewability rates. Faster loading pages and more engaging content also contribute to higher viewability. Achieving high ad viewability rates presents several challenges, including ad fraud, ad placement, non-human traffic, and technical factors like page load speed and ad design.

Implementing vCPM in Advertising Platforms

How Do You Set Up vCPM Bidding in Platforms Like Google Ads?

To set up vCPM bidding in Google Ads (or other ad platforms), you’ll need to choose a bidding strategy that focuses on viewable impressions, set your maximum bid, and then potentially customize bids at the ad group or placement level. Customizing bids can involve setting the same maximum vCPM bid for all keywords and placements within a specific ad group or, for more precise control, you can also set individual vCPM bids for specific placements.

What Are the Typical Settings and Options Available for vCPM Campaigns?

vCPM campaigns offer settings and options focused on maximizing the visibility and impact of your ads. These include targeting, bidding, and creative optimization. Targeting can refer to audience targeting, where you reach out to people based on demographics, location, interest, and so on; device targeting, where you focus on mobile or desktop devices; keyword targeting, where you tie your ads to search queries, and more.

How Should You Monitor and Adjust Your vCPM Bids?

To effectively monitor and adjust vCPM bids, regularly analyze campaign performance metrics like viewable impressions, click-through rates, and conversions. Adjust bids and creative strategies based on this data to optimize your ROI. Always consider implementing A/B testing, seeing how different attribution models are working — or not working.

Key Takeaways

vCPM stands for viewable cost per mille and is a pricing model where advertisers pay based on the number of times their ad is actually seen (i.e., is considered viewable) by users, as opposed to just the number of times the ad is merely placed. Unlike traditional CPM, which charges for every 1,000 impressions regardless of whether they are visible, vCPM focuses on the true value of viewable impressions.

That said, even ads considered “viewed” might not have been actually seen. Display ads are considered viewed after being at least 50% visible for one second, while video ads are considered viewed when allowed to play for two seconds. Did the user glance down from his or her computer to a phone, or look up from a phone to a friend’s face as that ad showed? Marketers can never know for sure.

Still, vCPM helps to enhance transparency for advertisers and sets higher standards for publishers, who are incentivized to try for better ad placement because they can charge higher rates.

Frequently Asked Questions (FAQs)

What percentage of an ad needs to be visible to count as viewable?

For most digital ads on a website, in a search engine results page (SERP), on an app, or on social media, 50% of an ad has to be fully visible for it to be considered viewable, and for at least one second.

How does vCPM compare to other bidding strategies like CPC or CPA?

vCPM differs from CPC (cost per click) and CPA (cost per acquisition) by focusing on the visibility of an ad rather than clicks or conversions. vCPM only charges advertisers for impressions that are actually (or very likely) seen by a user, while CPC pays for clicks, and CPA pays for specific actions like conversions.

How can I improve the viewability of my display ads as a publisher?

To improve display ad viewability, publishers should focus on optimizing ad placement, improving page load speed, and utilizing responsive design. Strategic placement, like above the fold positioning or placement on sidebars, increases the likelihood of ads being seen. Additionally, lazy loading and ad refreshes can enhance viewability.