You’ve been in the game long enough to know that balancing CPC and CPM isn’t a walk in the park. It's easy to get caught up chasing clicks or impressions, but getting the best out of both is where the real challenge lies.
Maybe you’ve seen one campaign burn through your budget with lots of views and no clicks, or another drive clicks but at a higher cost than you’d like. So, how do you juggle them without wasting spend?
This article covers than just the basics—it’s about figuring out the right balance that actually moves the needle on your performance.
Step One: Identify Your Goal
To balance out CPC and CPM, you need to first understand the goal of your ads. In fact, before you kickstart any campaign, having a solid understanding of your goals is essential.
If your goal is to get your name or product in front of as many people as possible, CPM is likely the way to go. You’re not necessarily chasing clicks; you just want people to see your ad.
On the other hand, if you want people to take a specific action (like clicking on your ad, signing up for something, or making a purchase), you might want to lean towards CPC. Here, you’re paying only when someone actually clicks on the ad, making it easier to track direct results from your budget.
Step Two: Test, Test, Test
Yes yes, we get it, you’ve heard that testing is important a million times, but when it comes to CPC and CPM, it’s not just important—it’s essential.
There are no magic formulas that work for every brand, product, or audience, which is why testing different strategies is your best bet.
Here’s how to run these tests:
A/B Test Different Campaign Structures
When I say “run split tests,” I don’t just mean throw two campaigns up and hope for the best. You need to structure them in a way that isolates CPC and CPM so you can understand what’s working. Here’s how we typically do it:
Create two identical campaigns: Use the same creative, audience, and targeting for both campaigns, but focus one on CPC and the other on CPM. The goal is to change only one variable at a time (in this case, how you’re charged) so you know exactly what’s affecting performance.
Why Split Tests for CPC vs. CPM?
Okay, so you’re probably wondering: “Why go through the hassle of creating two separate campaigns when I could just track CPC and CPM in one?” It’s a fair question, but here’s why split testing is the way to go.
Isolate Your Metrics
When you run a single campaign and try to track both CPC and CPM, you’re mixing those metrics up, which can muddy your results. Think about it—every platform has its own algorithm that’s designed to optimise for your goal, whether that’s impressions or clicks.
When you run two identical campaigns (same ad creative, same audience, same everything), but with one focused on CPC and the other on CPM, you’re changing only one thing: how you’re charged. This makes it a lot easier to figure out what’s actually making the difference in your results.
The Algorithm Works Differently for Each
Here’s the thing with ad platforms—they’re smart. If you choose CPC, the algorithm is going to prioritise showing your ads to people who will click. If you go with CPM, it’ll aim to get your ad in front of as many people as possible.
So, if you try to track both in one campaign, the platform’s optimisation will be torn between two objectives, and that could mess with your results.
Cleaner Data = Better Decisions
When you separate CPC and CPM into their own campaigns, your data will be a lot clearer. You’ll be able to tell exactly what’s driving the results: whether it’s getting more eyeballs on your ads (CPM) or encouraging more clicks (CPC).
Trying to track both in one campaign can make it harder to figure out what’s really going on, because the platform is optimising based on one of those metrics, and it might not give you the full picture. Clean data = smarter decisions.
You’ll Know Where to Shift Your Budget
Once you’ve got your results from the split tests, you can decide which strategy to lean into. Maybe CPM works better for building brand awareness, and you’ll want to push more budget that way. Or maybe CPC is driving more conversions at a lower cost, so you’ll focus there.
When you try to do both in one campaign, it’s harder to know which approach is actually getting the job done. Splitting them up gives you a clear idea of where to put your money for the best results.
Going Beyond CTR and Impressions
Now let’s talk metrics, because focusing solely on clicks or impressions isn’t going to tell the full story.
Click-Through Rate (CTR): This is a good starting point, but don’t rely on it alone. A high CTR on a CPC campaign could mean that your ad creative is working, but if those clicks aren’t converting into sales, what’s the point? You’re paying for curiosity, not intent.
Conversely, a low CTR on a CPM campaign doesn’t mean it’s a failure—those impressions could be boosting brand awareness and influencing later conversions.
Conversion Rate and Cost per Purchase: This is where things get interesting. Pay attention to the quality of the traffic you’re getting from both types of campaigns. Maybe your CPM ad is bringing in lots of impressions, but users aren’t converting. Meanwhile, your CPC ad might be more expensive per click, but the traffic is converting at a higher rate.
Here’s what you can do: calculate your cost per purchase for both types of campaigns. If your CPM campaigns are giving you more conversions at a lower cost, you might be better off focusing on impressions. If CPC is driving conversions more cost-effectively, double down there.
Step Three: Time to Optimise
Once you’ve gathered all this data, it’s time to optimise. Don’t just set it and forget it—CPC and CPM require constant adjustments based on performance. Here’s what you can do next:
Budget reallocation: After all that testing, you’ll have a clearer idea of what works best for different audiences or product categories. For example, you might find that CPM works great for brand awareness during the initial stages of a campaign, but CPC is better for driving conversions later on. Shift your budget accordingly.
Creative tweaks: Sometimes the data might tell you that it’s not CPC or CPM that’s the issue—it’s the creative. If a CPM ad isn’t getting impressions, or a CPC ad is struggling to get clicks, it might be time to change your creatives or copy to better engage your target audience..
Step 4: Focus on Frequency
Ever noticed how sometimes you see the same ad over and over again? Yeah, that’s definitely not always a good thing. If people see your ad too often, they could get bored, annoyed, or worse—completely ignore it. And that’s not what you want, right?
Frequency measures how many times your ad is shown to the same person. When it gets too high, you’re risking ad fatigue, where people mentally tune out or actively avoid your brand. That leads to lower engagement and, ultimately, wasted ad spend.
So, what’s the right frequency?
Now, finding the “perfect” frequency isn’t a hard-and-fast rule—it really depends on your audience, ad type, and campaign goals. But here’s a rough guideline:
For awareness campaigns (CPM): You’ll want people to see your ad multiple times to build recognition, but not so much that it becomes irritating. A frequency of 3 to 5 is often considered the sweet spot for awareness. People need a few touchpoints to remember your brand, but more than that can start feeling repetitive.
For conversion-focused campaigns (CPC): Since you're paying for clicks, it’s important that your ad stays fresh and engaging. Here, keeping frequency under 3 is ideal. If someone’s seen your ad more than three times and still hasn’t clicked, chances are they’re not interested. It might be better to shift focus or tweak your creative.
Step Five: Budget and Bid Adjustments
If one strategy isn’t working, don’t be afraid to adjust. Lower your bid on CPM if your ad is being shown a lot but isn’t driving much engagement. Or, raise your CPC bid if you want more clicks but aren't getting them.
Many platforms even allow you to set both CPC and CPM bids in the same campaign, letting their algorithms adjust based on performance.
Step Six: Focus on the Long Game
CPC and CPM are just pieces of the puzzle when it comes to successful advertising. The real results come from blending the two, continuously testing, and making improvements as you go.
Keep in mind, what drives results today might not have the same impact next month, so stay flexible, experiment often, and don’t hesitate to make adjustments when needed.
SO, WHERE DO YOU FIND THIS PARTNER?
Well, aren’t we glad you asked! We at DigiCom are obsessive data-driven marketers pulling from multi-disciplinary strategies to unlock scale. We buy media across all platforms and placements and provide creative solutions alongside content creation, and conversion rate optimizations. We pride ourselves on your successes and will stop at nothing to help you grow.
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