Viewable CPM (vCPM)
What is vCPM or Viewable CPM
vCPM (Viewable Cost Per Mille) is a digital advertising metric that measures the cost of displaying an ad to 1,000 viewable impressions. This means that advertisers will pay for the ads that were viewed and not for the ads served on the website.
What counts as a view
According to Interactive Advertising Bureau, a view is calculable based on the following criteria:
- Over 50 percent of the ad is visible on the user’s screen
- The ad is displayed to the user for longer than 1 second
- Over 50 percent of the video ads must be viewed for more than 2 seconds
- For larger images, that are over 2,42,500 pixels, the viewer must see over 30 percent for over 2 seconds
These standards are required to be met for an ad to be considered as “viewed”.
Viewable CPM Formula
vCPM= Budget ÷ [(Total Ad Impressions x % of Ad Viewability) ÷ 1000]
- Budget: This refers to the budget allotted for vCPM campaigns. It is a portion of the company’s advertising budget.
- Total ad impressions: This is the total number of times an ad was viewed.
- Ad viewability: This is the average amount of ads that were placed above the fold.
Let's simplify this concept with some numerical:
Ad viewability: 72%
Ad campaigns budget: $300,000
Total impressions: 40,000,000
$300,000 ÷ [(40,000,000 * 0.72) ÷ 1000) = $0.096
Why do ads lose viewability?
Several factors contribute to your ads losing viewability. They are:
- Ad Blockers: These are software designed to block ads and filter content that appears on a web page. These ad blockers identify the slots allotted for ads and hide the ads before a user can see them. The user will only view a blank space on the web page.
- Bot Traffic: Bots are programs that imitate human behaviors accurately. They can refresh pages, click on links, scroll up or down a page, and more. Ad networks cannot detect bot traffic and bot impressions will also be taken into account.
- Ad Placements: Placing ads in the right location increases viewability. If the ad hampers the scrolling position, if it is below the fold, or if its dimensions are irregular, then it impacts viewership.
- Erroneous Impressions: Many entities/ web crawlers like download managers, link checkers, and web filters usually load webpages and generate impressions. This cannot be taken into account.
- Ad Fatigue: When multiple ads are shown to a user one after the other on a single webpage, they are likely to experience ad fatigue.
Factors that affect viewability
Many factors prevent users from achieving the ideal ad viewing experience. They are:
- The position in which the ad is placed
- The size and layout of the ad
- Loading speed of the page
- Channels on which the ad is published
- Design of the page
- Length of the page on which the ad will be placed
- Responsiveness of the ad
Why is vCPM bidding important
From the advertiser’s point of view, vCPM is a pricing model where advertisers pay a predetermined amount for every 1000 viewable impressions their ad receives. This vCPM bid strategy allows advertisers to pay for every ad that has been viewed rather than every ad that has been served.
From a publisher’s point of view, Viewable CPM is a metric that helps publishers gain a more accurate estimate of their ad inventory’s value. Viewable CPM also helps publishers optimize their ad placements and formats to attract high-quality advertisers.
vCPM vs CPM
Viewable CPM can often be confused with CPM but they have many notable differences. vCPM only takes viewable impressions into account. An advertiser is charged only for the ads that are viewed.
CPM or Cost Per Mille is the amount charged for an advertiser for every 1000 views a web page receives.