What it means
Each time an advert loads on a page, in a feed or in a video, the system counts one impression. The count is automatic and is reported by the platform that serves the advert.
It is the starting point for the funnel of marketing metrics that leads from impressions to clicks, visits, sign-ups and finally sales. Impressions are different from reach.
Reach counts the number of unique people who saw the advert at least once, while impressions count every display. Dividing impressions by reach gives frequency, which tells you how many times the average person saw the advert.
Advertisers are often charged per thousand impressions, a pricing method known as CPM, where the M stands for the Roman numeral for a thousand. This is common for brand awareness campaigns, where the aim is to be seen rather than to prompt an immediate click.
Other campaigns pay per click or per sale, and the right model depends on the objective. Finance teams care because impressions drive marketing spend and are the denominator in many efficiency ratios.
The click-through rate is clicks divided by impressions, and the cost per click is spend divided by clicks. A high number of impressions with few clicks may signal weak creative or poor targeting, and a finance reviewer can use these ratios to challenge a budget.
There are caveats on quality. Not every counted impression is truly seen, because an advert may load at the bottom of a page that the user never scrolls to, or may be shown to automated traffic rather than people.
For this reason, the industry has introduced the idea of viewable impressions, which count only those that appeared on screen for a minimum time. The nuance is that impressions are a cheap number to inflate and a poor measure of success on their own.
A campaign with ten million impressions that produces no sales has not delivered value, so the figure should be read alongside conversions and revenue.
In practice
Real-world examples
Example 1
A clothing brand runs a social media campaign with a $30,000 budget and reports 4,000,000 impressions. The marketing manager calculates a CPM of $7.50 and compares it with a previous campaign at $9.00, concluding the new one was cheaper to run.
Example 2
A software company sees 500,000 impressions on a search advert but only 1,000 clicks. The finance analyst questions the budget and asks the team to test new headlines, because a 0.2% click-through rate suggests the advert is not persuasive.
Example 3
A local restaurant pays $400 for a week of advertising in a community newsletter with a measured 20,000 impressions. The owner counts the new bookings that mention the advert to see whether the exposure produced customers. Eleven bookings worth about $1,100 in total suggest the spend was worthwhile, even though the cost per thousand impressions was a high $20.
Think of it
Impressions are like putting up a billboard beside a busy highway. Every time a car drives past and the driver has the chance to look at the sign, that is one impression, regardless of whether they actually read the text or kept their eyes firmly on the road.
Formula
Calculation
CPM = (total cost / impressions) x 1,000
Suppose a company spends $15,000 on a campaign that delivers 2,000,000 impressions. CPM = (15,000 / 2,000,000) x 1,000 = 0.0075 x 1,000 = $7.50 per thousand impressions. If the campaign also produces 10,000 clicks, the click-through rate is 10,000 / 2,000,000 = 0.005, or 0.5%, and the cost per click is 15,000 / 10,000 = $1.50.Case study
Seen in the real world
Harborview Outfitters is an illustrative, fictional online retailer that ran a display campaign with a budget of $60,000. The agency reported 12,000,000 impressions and called the campaign a success, pointing to a low CPM of $5.00.
The finance manager noticed that the campaign produced only 300 sales with an average order of $80, or $24,000 of revenue. On a gross margin of 40%, the profit from those sales was 24,000 x 0.40 = $9,600, far below the $60,000 spent.
The company switched its measurement to cost per sale and changed its targeting. The illustrative lesson is that impressions show how widely an advert was displayed, but profit depends on what happens afterwards, and the agency's report should have shown both.
Watch out
Common mistakes
- Treating impressions as the number of people who saw the advert, when one person can generate many impressions.
- Judging a campaign on impressions alone, without checking clicks, conversions and revenue.
- Assuming every impression was actually seen, when some are never visible or are produced by automated traffic that has no buying power at all.
Questions
People also ask
What is the difference between impressions and reach?
Impressions count every time the advert is displayed, while reach counts the number of different people who saw it at least once.
What does CPM mean?
It is the cost per thousand impressions, calculated by dividing total cost by impressions and multiplying by 1,000.
What is a viewable impression?
It is one that appeared on screen for a minimum time and in a minimum share of its area, so there is a fair chance it was seen. Advertisers often pay a premium for viewable impressions because they are a more honest count of exposure.