At a time when more ad dollars are shifting from traditional TV to digital video, research company Standard Media Index has developed a new metric that enables buyers and brands to better compare the costs of network and cable to over-the-top.
The new metric is effective cost per thousand viewers–eCPM. Brands buy television based on estimates of how many viewers they expect their commercials to reach. Sometimes campaigns exceed those forecasts, sometimes they fall short and, if there’s a guarantee, the brand gets makegood ads to cover the shortfall.
Digital ads are sold based on impressions, and commercials stop being served exactly when the contracts number of impressions have been delivered.