Last updated: 2026-07-02

The three core advertising metrics

Almost every paid-media report leans on three numbers: CPM, CPC, and CTR. They are built from just three raw inputs — how much was spent, how many times the ad was shown, and how many times it was clicked — but each answers a different question. CPM measures the cost of reach, CPC measures the cost of engagement, and CTR measures how compelling the creative and targeting were. Read together, they explain not just what a campaign cost but why.

This calculator takes ad spend, impressions, and clicks and returns whichever of the three you select, showing the formula it used so the result is easy to check.

The formulas

CPM — cost per mille, meaning cost per thousand impressions — divides spend by impressions and scales to a thousand:

CPC — cost per click — divides spend by the number of clicks:

CTR — click-through rate — divides clicks by impressions and expresses the result as a percent:

CPM and CPC are amounts of money; CTR is a rate. That difference matters when comparing campaigns: a low CPM tells you reach is cheap, but only CTR tells you whether that reach is turning into clicks.

Worked example: a display campaign

A brand runs a display campaign and, at the end of the week, pulls three numbers from the ad platform: it spent $500, the ads were served 100,000 times, and they were clicked 2,000 times.

CPM. Spend over impressions, times a thousand:

Every thousand impressions cost $5.00.

CPC. Spend over clicks:

Each click cost 25 cents.

CTR. Clicks over impressions:

Two of every hundred impressions produced a click.

How the three connect

The metrics are not independent — they share the same spend, impressions, and clicks, so any two constrain the third. Cost per click can be rebuilt from cost per reach and engagement rate:

Using the example, $5.00 divided by (1000 × 0.02) gives $0.25 — the same CPC computed directly. The relationship shows the lever that matters most: for a fixed CPM, a higher CTR drives CPC down, because the same reach spend is spread over more clicks. Improving creative or targeting to lift CTR often lowers the effective cost of a click without touching the media rate at all.

Reading the numbers in context

A cheap CPM is only good if the audience is right; a low CPC is only good if those clicks convert. CTR benchmarks vary widely by channel — search ads commonly clear a few percent while display and social often sit below one percent — so the most useful comparison is against your own past campaigns and against ads chasing a similar audience. Treat CPM, CPC, and CTR as the top of the funnel, and pair them with conversion rate and return on ad spend before judging whether a campaign paid off.