Where Does CPM Come From?
Advertising is one of the oldest industries out there, with records of it being found all the way back to the Ancient Egyptians. Despite this history (and an overabundance of people who like to talk) there’s no real overview of advertising. Some books are out there, and there is some diligent journalism about what’s going on, but basic things, simple things, are still unexplained.
Case in point: although I could find hundreds of articles explaining what CPM means, I couldn’t find anything pointing at where it came from, how long it’s been in use, or even the most basic question, why it’s French (the M of CPM, of course, standing for mille [‰], which could be French, Italian, or Latin, and means one-thousand). That last part is even more confusing because the Romans did advertise so it’s possible they measured in CPMs (or something similar). It is hard, though, to imagine a scenario when they would be measuring the impressions of a street crier in the thousands. So maybe CPM’s relationship to advertising is that old, but I doubt it.
It turns out the story of where CPM comes from isn’t that interesting, once I sussed it out, but it’s tied to the history of modern advertising, which is interesting.
The Greatest Invention
Modern advertising in the west didn’t really sprout up until the printing press and the mass circulation of newspapers. Until that point there was no mass print medium, and advertising was generally regulated to business signs and word of mouth. With the printing press, cheaper printing became a reality and newspapers and periodicals provided a huge new opportunity to reach people and sell wares. But there’s a big time gap between the first newspaper and modern advertising.
An industry as wide-reaching as ours is based on lots of people seeing it and for a long time the majority of newspapers weren’t available to the general public. Although initially a literacy problem, eventually it turned into a censorship one.
People quickly figured out that newspapers, and the printed word in general, was a good way to circulate ideas, and it was getting cheaper every year to print mass amounts. Some of those ideas, however, weren’t too popular with the people in power. So the people in power decided to do something about it.
A Tax on Knowledge
You see, the British government only wanted those newspapers friendly to both itself and the church to be widely available to the public, and so they taxed all printed materials heavily. The tax was called the Stamp Act of 1712 (a different Stamp Act from that revolution one) and you could be exempt from it if you were sponsored by a politician, which lead to a lot of criticism and conflict of interest. Over the next 150 years the tax would slowly raise and fall until lengthy public outcry and feedback pushed the British Government to repeal it. With this needless tax gone, cheap press became viable (if you’re interested in taxes used to suppress the unwashed masses, you should also check out the British Window Tax, from around the same period), and suddenly everyone could afford a newspaper.
The Stamp Tax was dubbed by its detractors as a ‘Tax on Knowledge’, and it really was. It made it hard to have a successful newspaper because the tax was levied onto the readers, not the printers, and kept criticism to a minimum, halting the spread of knowledge. Only the rich could afford the tax for the unsponsored newspapers which kept the poorer population uneducated and uninvolved in the goings on around them. Repealing the ‘Tax on Knowledge’ was a big step towards giving the vote to more of the population as they could educated and attracted in greater numbers. One of the major forces in getting the act repealed was Thomas Milner Gibson, who also pushed for more voting rights in England. In fact, Thomas Milner Gibson was such a force in getting the ‘Tax on Knowledge’ repealed that ‘A History of Advertising’ by Henry Sampson (1875), one of the first books devoted to the medium, is dedicated to Gibson.
That handsome guy Thomas Milner Gibson
With the repeal of the Stamp Act and the appearance of the cheap press, suddenly we see a situation similar to the proliferation of the internet: a flood of people looking for new content to consume and companies trying to figure out how to make money at it. Just like with the internet, advertisers stepped in to subsidize the newspapers, in a way they never could before. Suddenly people all over the world (or at least the western world) could be reached and persuaded to buy products. Mass advertising was born and the cottage industry around it started to grow. Soon there were advertising agencies and periodicals and books devoted to the same thing we talk about today: How to get people to buy something.
Back to CPM
Around this point is also where CPM comes into the fold, at least in relation to advertising. It turns out that CPM itself is a pretty old term and has been used as a measurement system for a while. For instance, it appears to have been used in construction for centuries, relating to board feet or stone or ore or, really, anything in large quantities.
Occurrence of CPM in literature over the years
Newspapers began advertising and charging by CPM soon after the Stamp Act was repealed and was based in subscribers. Together with the size of the placement they were used as the pricing model for ads, much like how we use CPM’s today. It took hold (the first reference to newspaper CPM’s I could find was in 1884), and from there it’s pretty much what you expect. We’ve been using it as a metric for over one hundred years at this point, with it really picking up with TV, and even as other metrics come into fashion (viewability, CPA, etc.), I’m sure it’ll be around for a while, and maybe one day we’ll know who thought it up in the first place.