coverspace - streetsmart with web analytics

Slightly delayed on to the last round of defining the main web and monetization metrics (the classics, so to say) - the CPXes or more detailed: CPM, CPL, CPA, CPO - comment if you desire to see more.

1. CPM (Cost-per-thousand or in German TKP - Tausenderkontaktpreis)

Used mainly in the media/banner/graphical advertising world the CPM describes the price an advertiser has to pay for a thousand impressions of a certain ad. To count as a valid impression the ad (and usually the entire respective page) needs to be visible - this means that it has to be fully loaded (counted by a tracking item embedded in the page code at the end of the page). So if the page is still loading and the users clicks on to the next page most likely no impression will be counted.

Equivalent to the CPM the search engine world sometimes uses the RPM (Revenue per thousand) - be careful what the thousand is: impressions (as above) or searches (e.g. if you type in a search term and flip through the search results pages) which can contain more than one impression

2. CPL (Cost-per-Lead)

CPL does not refer to heavy metal but to a referral characterized by a commercial intent and for this paid for by an advertiser. Example: A user would like to buy a digital camera - this is a probable process she/he walks through:

1. Search “digital camera” on Google - leading to a search results page (no Lead)
2. Click on shopping.com-link on search results page - leading to a landing page at shopping.com (no Lead)
3. Select brand, price range etc on landing page at shopping.com - leading to a product search results page with several cameras listed and shops next to each listing (no Lead)
4. Click on one of the listings to a shop - leading to the shop selling the specific digicam (Lead)

Usually the shop in our example pays a certain price for this lead - so the advertiser (the shop) incurs a cost for this lead.

3. CPA (Cost-per-Article or Cost-per-Action) and CPO (Cost-per-Order)

CPA or CPO are used for e-commerce shops with shopping baskets (goods or services) - it basically works like CPL with the difference that the referring party (e.g. shopping.com) is not paid based on the number of leads but based on the number and kind of article the user buys (e.g. a pair of sport shoes) or the kind of action they perform (e.g. create a wishlist on amazon.com) or even the amount of money the users spends (5% of value of shopping basket) or the number of articles they buy (10$ for more than 50 articles).

There are numerous variations that all have in common a transaction of goods and services that have a certain value on which basis usually the CPL, CPA or CPO is determined.

So much for the overview - next week (hopefully) we will be back with metrics and monetization in the web 2.0 world - Stay tuned

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