User engagement in a cookieless world: CPE vs. CPM – Which metric spells success?

In an age where digital advertising is undergoing a seismic shift, the impending changes surrounding the deprecation of cookie usage and the emergence of privacy-centric browsers like Brave are reshaping the conversation around advertising metrics. The importance of engagement in a cookieless world cannot be overstated. As we move toward a future where tracking user behavior becomes increasingly challenging, CPM faces a huge obstacle.?

The ability to decipher a user's true intent or interests becomes murky in this landscape. However, engagement stands out as a beacon of clarity. It becomes the metric that allows us to evaluate the success of media targeting and ad campaigns. Users, even in a cookieless environment, will engage with brands that resonate with them, transcending mere intent. It becomes a vital instrument for brand building and brand awareness, offering a lifeline in an era where precision targeting faces formidable obstacles.

In the ever-evolving world of digital advertising, where competition is fierce and consumer attention spans are dwindling, making informed decisions about where to allocate your advertising budget is more critical than ever. We look to take on the challenge of the CPE vs. CPM conundrum, exploring the nuances, challenges, and opportunities that each metric presents.

Cost per Engagement (CPE) and Cost per Impression (CPM) are both important metrics in digital advertising, but they serve different purposes and have distinct advantages. Here are the top three arguments for using CPE over CPM:

Quality Over Quantity:

• Engagement Focus: CPE focuses on the cost of user interactions with an ad, such as clicks, likes, shares, comments, or video views. These interactions demonstrate active interest and engagement with the content, indicating a higher likelihood of conversion or brand engagement.
• CPM Emphasizes Visibility: CPM, on the other hand, measures the cost per thousand impressions, primarily focusing on how many times an ad is displayed to users. Impressions do not guarantee that users pay attention or interact with the ad, so it doesn't necessarily reflect user engagement or interest.

Performance-Based Pricing:

• Pay for Results: CPE is performance-based; advertisers only pay when users take specific actions or engage with the ad. This aligns the advertising budget more closely with desired outcomes, such as website visits, sign-ups, or purchases.
• CPM May Waste Budget: CPM charges advertisers for ad impressions regardless of whether users interact with the ad. This can result in a wasted budget if impressions do not lead to desired actions. Advertisers argue that CPE offers a more efficient way to allocate their budget based on actual engagement and conversions.

Optimizing for Engagement and Conversions:

• Campaign Objectives: Advertisers often have specific campaign objectives, such as driving traffic to a website, generating leads, or increasing sales. CPE allows advertisers to optimize their campaigns for these objectives by measuring the cost of achieving them directly.
• Actionable Insights: CPE provides actionable insights into which ads, creatives, or targeting strategies are most effective at driving user engagement and conversions. Advertisers can use this data to refine their campaigns and improve performance.

It's important to note that the choice between CPE and CPM depends on campaign goals, industry, and targeting strategy. Some campaigns may benefit from CPM when brand visibility and reach are the primary objectives, while others may find CPE more suitable when driving user engagement and conversions is the top priority. Advertisers often use a combination of both metrics to achieve a balanced approach to their digital advertising campaigns but when getting results is what matters most one stands out best.

Interested to find out how you can engage with your users in a cookieless world? Contact us