Online Advertising Formula Reference

Occasionally I need to manipulate online advertising formulas to make a quick calculation.  The following serves a quick cheat sheet for this purpose. Note that the term Cost is from the perspective of the Advertiser. The web site or publisher can translate that into Revenue.

CPM Campaigns

Cost = Impressions / 1000 * CPM

CPC Campaigns

Cost = Impressions * CTR * CPC

CPM = CTR * CPC * 1000

CPA Campaigns

Cost = Impressions * CTR * AR * CPA

CPM = CTR * AR * CPA * 1000

Notation	Description
CPM	Cost Per 1000 Impressions
CPC	Cost Per Click
CPA	Cost Per Action
CTR	Click Thru Rate (Clicks / Impressions)
AR	Action Rate (Actions / Clicks)