CPM vs CPC vs CPA vs CPL vs CPI - What's the Difference?
All five of these terms describe the same thing from different points in a visitor’s path: what one unit of advertising costs. The difference is which event counts as the unit.
| Model | You pay for | Formula |
|---|---|---|
| CPM, cost per mille | 1,000 impressions | Cost / impressions x 1,000 |
| CPC, cost per click | One click | Cost / clicks |
| CPL, cost per lead | One lead, such as a completed form or sign-up | Cost / leads |
| CPI, cost per install | One app install | Cost / installs |
| CPA, cost per action | One action you defined, such as a purchase | Cost / actions |
“Mille” is Latin for thousand, which is why CPM is priced per thousand rather than per impression. A single impression costs fractions of a cent, and nobody wants to read a price with five zeros after the decimal point.
One campaign, five numbers
The fastest way to see how these relate is to run one campaign through all of them. Say an advertiser spends $500 and gets these results:
| Event | Count | Cost per event |
|---|---|---|
| Impressions | 250,000 | $2.00 CPM |
| Clicks | 1,250 | $0.40 CPC |
| Leads (sign-ups) | 100 | $5.00 CPL |
| App installs | 40 | $12.50 CPI |
| Purchases | 10 | $50.00 CPA |
The spend never changes. Only the divisor does. Each step down the path has fewer people in it, so the price per event rises.
The rates between steps are what connect the models:
- Click-through rate is clicks / impressions: 1,250 / 250,000 = 0.5%.
- Conversion rate is conversions / clicks: 10 purchases / 1,250 clicks = 0.8%.
- So CPC = CPM / (1,000 x CTR), and CPA = CPC / conversion rate.
That second formula answers most “which model is cheaper” questions. A $2 CPM and a $0.40 CPC are the same price if your click-through rate is 0.5%. If your ads get 1% CTR, the CPM deal is now half the price of the CPC deal. If they get 0.25%, it’s double.
CPA vs CPL
These two get confused more than any other pair, and the confusion is reasonable, because a lead is an action.
CPA is the general term. The “action” is whatever the advertiser decides to pay for: a purchase, a subscription, a trial start, a phone call. CPL is CPA where the action is specifically a lead, meaning a person handing over contact details that a sales team or email sequence will follow up.
The practical difference is where the value is decided. With CPA on a purchase, the advertiser knows what the action is worth when it happens. With CPL, the lead is worth nothing until someone converts it later, so lead quality becomes the whole negotiation. A $5 lead that never answers the phone is more expensive than a $40 lead that buys.
That’s why CPL deals usually come with rules the other models don’t need: which fields must be filled in, which countries count, whether duplicates or disposable email addresses are rejected.
CPA vs CPM
This is the risk question. Somebody has to carry the uncertainty about whether ads turn into results.
On CPM, the advertiser carries it. They pay for impressions whether anyone clicks or not, and a weak creative or the wrong audience costs them directly.
On CPA, the seller carries it. A publisher or network running a CPA deal earns nothing from impressions that don’t lead to the action, so a campaign with a bad landing page burns their ad space for free.
Everything else follows from that. CPA prices per event are much higher than CPM prices because they include the risk. CPA deals are harder to get because sellers only take them from advertisers whose conversion rates they trust. And CPM stays the default in display advertising because the seller controls the inventory and the advertiser controls the creative and the landing page, so each side pays for what the other controls.
How the big platforms bill in practice
The model you bid with and the model you are charged on are often different, which is where a lot of confusion comes from.
Google Ads lets advertisers set a target CPA, but normally still charges per click. In Display campaigns there is an option to pay for conversions instead of clicks, and it has conditions: the account needs more than 100 conversions in the last 30 days, 90% of conversions must happen within 7 days of the click, and the target CPA must be under $200.
App campaigns work the same way. Advertisers set a target CPI based on what a new user is worth, and Google’s system bids toward it. The target is what the bidding aims at, not a promise that every install costs exactly that.
What each model suits
| Model | Suits | Why |
|---|---|---|
| CPM | Awareness campaigns, video, creative already proven to perform | Being seen is the goal, or the advertiser trusts the ad to earn its clicks |
| CPC | Advertisers who want traffic and trust their own site to convert it | People who aren’t interested don’t click, so a weak ad costs little |
| CPL | Insurance, education, B2B software, financial services | The sale happens later, through a sales process that starts with contact details |
| CPI | Mobile apps | The install is the first event the advertiser can measure reliably |
| CPA | E-commerce, subscriptions, affiliate offers | There is a clear, trackable action and enough volume for the seller to trust the numbers |
What this means if you run ads on your site
Publishers see these models from the other side, and most of the time they see one number: RPM or eCPM, revenue per thousand impressions or page views.
That’s because ad networks convert whatever the advertiser paid on into an effective CPM. If an advertiser pays $0.40 per click and your placement gets a 0.5% CTR, those impressions were worth $2 CPM, and after the network takes its share, what reaches your report is a slice of that $2 as eCPM. Our guide to calculating eCPM goes through the arithmetic.
Two things follow for publishers.
Clicks still matter on a CPM report. Networks rank advertisers by expected revenue per impression, so a placement where people click earns more even when the report shows only CPM.
The pricing model can change without your setup changing. Google AdSense moved to paying publishers per impression in early 2024, after years of paying mostly per click. Publishers didn’t have to do anything, but placements that had earned well from clicks and poorly from impressions saw their numbers move.
If you want the full list of numbers worth watching on the publisher side, our guide to publisher metrics covers RPM, fill rate and viewability.
