Recommender Systems: Online Business Metrics

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Content

• What is CTR?
• What is CVR?
• What is CPM and eCPM?
• What is RPM?
• What is GMV?

CTR (Click Through Rate)

CTR indicates the ratio showing how often people who see your ad or free product listing end up clicking it. Click-through rate (CTR) can be used to gauge how well your keywords and ads, and free listings, are performing.

CTR is the number of clicks that your ad receives divided by the number of times your ad is shown: clicks ÷ impressions = CTR. For example, if you had 5 clicks and 100 impressions, then your CTR would be 5%.

CTP (Click Through Probability)

CTP sometimes used as CTR measured as below:

# of unique visitors who click/# of unique visitors to page

CVR (Conversion Rate)

CVR, or conversion rate, in in-app advertising is the percentage of users who saw an app-install ad, clicked on it, and converted through some pre-specified action. CVR tells app advertisers how many users their ad converted.

Different from the CTR task, the samples available for this task is sparse and usually around 1% of the samples in the CTR task.

CPM (Cost Per Thousand/Mile) and eCPM

Cost per thousand (CPM), also called cost per mille, is a marketing term used to denote the price of 1,000 advertisement impressions on one web page. If a website publisher charges \$2.00 CPM, that means an advertiser must pay \$2.00 for every 1,000 impressions of its ad.

On the other hand, eCPM is concerned with the revenue generated by a thousand impressions. In marketing, CPM is crucial since it helps advertisers determine which platforms are viable for publishing ads. However, the effective cost per thousand ad impressions indicates the publisher’s ad revenue.

RPM (Revenue Per Mile)

Revenue per mille (RPM) is the estimated earnings that accrue for every 1000 impressions received (in Latin, mille means thousand), a commonly used measurement in radio, television, newspaper, magazine, out-of-home, and online advertising.

GMV (Gross Merchandise Value/Volume)

Gross Merchandise Value (GMV) is a metric that measures your total value of sales over a certain period of time. It’s a metric that is most commonly used in the eCommerce industry and is also sometimes referred to as Gross Merchandise Volume.