Calculate CPC and CPM

What is CPC on Facebook?

CPC stands for cost per click. This is the price you pay for each click on your Facebook ad.

You can choose to optimize for CPC if you want as many visits to your website as possible. Facebook will try get you as many clicks as it can within your budget if you choose this option.

Here is the official list of clicks that factor into your cost per click on Facebook:

• Clicks to visit another website
• Call-to-action clicks that go to another website (ie “Shop Now”)
• Clicks to install an app
• Clicks to Facebook canvas apps
• Clicks to view a video on another website

What is CPM on Facebook?

CPM stands for cost per mille. This is the price you pay for 1,000 impressions on your Facebook ad.

You should optimize for CPM on Facebook if you’re looking to get your ad seen as much as possible. If you select this option, Facebook will get your ad in front of as many eyeballs as it can within your budget.

Why pay per 1,000 impressions instead of per individual impression?

Impressions are pretty cheap, so if you counted the cost of each one you’d be dealing with fractions of a cent—it’s just easier to multiply by 1,000.

How to calculate CPC?

As previously mentioned, CPC is cost per click, so the formula for it is super simple:

                                          CPC = total_cost / number_of_clicks .

You may also derive it from CPM and CTR:

                            CPC = (CPM / 1000) / (CTR / 100) = 0.1 * CPM / CTR .

Nowadays, the common model is often not as straightforward as the one you see here.

How to calculate CPM?

Since CPM is cost per thousand impressions, then you simply divide the cost by the number of impressions divided by a thousand. So the CPM formula is:

                                            CPM = 1000 * cost / impressions