ABSTRACT
In the advertising industry, there are absolute costs and relative costs. Absolute costs, sometimes called unit costs or vehicle costs, refer to pay for placement in a specific media vehicle. Advertising on the Internet uses some of the same pricing approaches, such as cost-per-thousand, as does advertising in other media. Cost-per-thousand (CPM) is used in every media analysis from print to broadcast to online. It is the main cost comparison criterion looking at a variety of media, planners working with broadcast costs on both a national and local basis use a standard called cost-per-point (CPP). Media planners use CPP to add up media costs for a local market campaign. The reason CPP is used in broadcast planning instead of CPM is that CPP is a much simpler method of assessing costs across various markets or across various dayparts. As one assess media plans, it is important to understand the fundamentals of cost analysis and the fundamentals of trade-off analysis.
