What are the top 5 factors affecting eCPM?
Every publisher has a different story about their eCPM and how it varies from one day or month to another. While there are no set patterns or fixed rules, some things can impact your eCPM.
In this blog post, we look at the top 5 factors that can affect eCPM and the steps you can take to boost it.
- What is eCPM?
- eCPM formula
- Factors affecting eCPM
Let’s begin by understanding what eCPM is and how it is calculated.
What is eCPM?
In layman's terms, eCPM stands for ‘effective cost per thousand impressions’ (thousand impressions = a mile) which is the ad revenue generated per 1,000 ad impressions.
eCPM is a metric used to measure an app's ad monetization performance. If apps have a high eCPM, it means that the ads served on their app are effective at converting users. The app developer is paid more if the ads convert more users. Also, eCPM calculates the ad revenue generated by a specific campaign. Because ad networks use eCPM to rank campaigns within their ad serving models, the campaigns with the highest eCPMs are served first and most frequently, allowing them to succeed.
You can calculate eCPM using the formula below.
Factors affecting eCPMNow that we know the definition and the formula, let's look at the top 5 factors affecting eCPM.
Ad unitsDepending on the layout of your website, the ad unit chosen is arguably the most crucial variable in optimizing your eCPM.
Ads that are easily viewable convert better because click-through rate (CTR), which is an essential metric in driving eCPM, is high. eCPM rates for each ad unit vary depending on CTR, device type, location, engagement level, etc. The higher your overall eCPM, the more traction you can drive as an advertiser.
Each ad unit has its own set of benefits. For example, using Interstitial/Overlay Ad is typically the most profitable because its placement does not require optimization and can be seen by most of your traffic. Then there are Banner Ads, which provide more flexibility because they come in various sizes.
Type of traffic
Several types of traffic can impact eCPM rates. One of them is direct traffic or users visiting an app or website without being referred to by another site. This type of traffic generates higher eCPM because it is usually more engaged and more likely to convert.
Similar to direct traffic, there is organic traffic, which means users discover the app or website via a search engine or another online directory. This traffic is typically less engaged than direct traffic, but it can still be beneficial.
Finally, referral traffic is when users are directed to the app or website from another website. Depending on the referring site, this type of traffic can be either engaged or disengaged.
Level of trafficThe volume and quality of traffic to an app or website have a significant impact on its eCPM. To generate revenue from advertisements, a high volume of traffic is required, but it must be directly proportional to the traffic's quality. Quality traffic is the result of providing your visitors with relevant content and an enjoyable experience.
Advertisers do not prefer to pay more for an ad space if there is low and non-relatable traffic. As a result, to maximize revenue from ads, it is critical to attract and maintain a relatable and high level of traffic.
The level of competition also has a significant impact on the volume of traffic. Advertisers are less likely to pay top dollar for ad space if many other apps or websites compete for it. Conversely, if fewer competitors exist, advertisers are willing to pay more for their ad Formats.
Type of ad formatsThere are a variety of ad formats that can be used on apps and websites, and each has its advantages and disadvantages. The most common formats are banner ads, interstitial ads, and native ads. Each can have a different impact on eCPM.
Banner ads are typically small and discreet, but users can easily ignore them. Interstitial ads are more extensive and intrusive, but they can capture a user's attention more effectively. Native ads are designed to blend in with the content of the app or website, and they can be very effective in engaging users.
Fill ratesFill rate is the percentage of times your ad units display an ad when there is an opportunity. Assume you embed one of our ad units and receive 100 visitors today. If you show an advertisement to every visitor, your fill rate is 100% (optimal).
Remember that the more ad units you place, the more likely it will not display an ad. In addition, putting too many ad units on a single page may result in a policy violation.
Choose a reputable ad network to increase your fill rate. Most tend to provide around a 50-60 percent fill rate.
GreedyGame being the channel partner of Google, provides premium quality ad network which enables you to achieve 90-95 percent fill rate.
Your eCPMs are the amount of money you can expect to receive as a publisher in exchange for the number of impressions your ad unit receives. eCPMs can differ between publishers depending on a variety of factors. We hope this blog post has helped you learn more about them.
Thank you for reading, and we hope you found this information helpful!