Many advertisers hope viewers will click their ad - but that's not always the main goal. Maybe you just want a lot of people to see your ad. In that case, bidding by cost-per-thousand-impressions (CPM) is a good way to go. With CPM bidding, you bid for your ad based on how often it appears on the Google Display Network. You set the max amount that you want to pay for ads, whether they're clicked or not.
Why use CPM bidding
Some people prefer CPM bidding because they want to be able to set a maximum amount that they'll pay for each impression, instead of for each click.
Others simply don't care about clicks for their ad campaign. Businesses that just want to get their name in front of more people, for instance, may care more about ad views than about clicks and visits to their website.
If your main goal is online sales or visits to your website, then cost-per-click (CPC) bidding may be a better option for you.
A quick comparison of CPM and CPC bidding
We'll get into a few more details below, but here are some of the basics:
To keep things fair, when CPC and CPM ads compete for the same Display Network placement, the two types of ads are compared apples-to-apples on how much they're effectively willing to pay for the impression. With a CPM ad, the max. CPM bid represents how much the advertiser is willing to pay for each 1,000 impressions; with a CPC ad, you get estimated how many clicks the ad might receive in 1,000 impressions to get the comparison.
How to use CPM bidding
With CPM bidding, you set the highest amount that you want to pay for each 1,000 ad impressions. We call this the maximum CPM bid, or just "max CPM".
The higher your max. CPM, the greater the chance that your ad will appear. As always, the AdWords system will charge you only what is needed to place your ad above the next-highest ad.