Why Session RPM is a better metric than eCPM? [4 Reasons]

When it comes to programmatic advertising, understanding the right metrics to gauge revenue performance is crucial. Two of the most commonly discussed metrics are Session RPM (Revenue Per Mille) and eCPM (Effective Cost Per Mille). While eCPM has long been a staple in the advertising industry, Session RPM offers a more comprehensive and user-centric view of monetization performance. This article explores why Session RPM is superior to eCPM and how it can provide deeper insights into revenue generation.

Here’s why Session RPM gives a clearer picture of monetization performance:

User-Centric Focus

Session RPM shifts the focus from mere ad impressions to user engagement. This metric emphasizes how much revenue is generated per user session, encouraging developers to think strategically about enhancing user experience and increasing revenue from each session rather than just maximizing ad impressions. This user-centric approach aligns with the goals of many gaming apps that rely on both ad revenues and in-app purchases (IAPs) to drive overall profitability.

Reveals the Impact of Ad Frequency

While high eCPMs may seem attractive, they can often be achieved at the expense of user experience. For instance, if an app bombards users with ads to inflate eCPMs, it can lead to user dissatisfaction and lower retention rates. Session RPM helps developers strike a balance between ad revenue and user satisfaction by providing insights into how ad frequency impacts overall revenue per session. This balance is essential for maintaining a loyal user base in gaming apps where engagement is key.

More Relevant for In-App Purchases

Gaming apps frequently depend on in app purchases or IAPs as a significant revenue source. Session RPM captures the combined revenue from both ads and IAPs, offering a holistic view of monetization performance. This comprehensive perspective allows developers to understand how different monetization strategies affect overall revenue, making it easier to optimize their approaches.

Difficult to Manipulate

One of the critical advantages of Session RPM over eCPM is its resistance to manipulation. eCPM can be artificially inflated by increasing unfilled ad impressions or setting higher price floors for ads, which may mislead developers about their actual revenue performance. In contrast, Session RPM reflects the genuine earnings generated from each user session, making it a more reliable indicator of an app’s financial health.

How Monetization Partners Manipulate eCPMs

Monetization partners manipulate eCPMs through various tactics that may not necessarily correlate with actual revenue growth:

Increasing Unfilled Ad Impressions:

Partners generate a large number of ad requests, even when they know a significant portion of those requests won’t be filled with actual ads. This increases the total number of impressions, which can artificially inflate the eCPM calculation (since it’s based on revenue per thousand impressions).

While the eCPM might look higher, the publisher isn’t actually earning more revenue. In fact, they may be losing potential revenue by showing blank ad spaces instead of potentially valuable ads.

Inflating Price Floors:

Setting artificially high price floors for ads can lead to increased eCPMs on paper while reducing fill rates and overall revenues.

While the eCPM might look impressive, high price floors can significantly reduce the number of ads that are actually served (lowering the fill rate). This can lead to fewer overall impressions and potentially lower overall revenue, even if the eCPM is higher.

These practices result in misleading metrics where eCPMs rise even as actual revenues and return on investment (ROI) decline. This discrepancy highlights the importance of relying on metrics like Session RPM that provide a clearer picture of monetization effectiveness.

By tracking Session RPM, publishers can:

• Get a holistic view: Session RPM captures revenue from all sources within a session, including ads, in-app purchases, and subscriptions.
• Focus on user experience: Optimizing for Session RPM encourages publishers to create a positive user experience that keeps users engaged and coming back for more, leading to long-term revenue growth.
• Avoid misleading metrics: Session RPM is less susceptible to manipulation, as it reflects the actual revenue generated from each user session.

How MonetizeMore Can Help with Session RPMs

MonetizeMore specializes in optimizing ad revenue through data-driven strategies that focus on improving Session RPMs. Their approach includes:

• PubGuru Platform: MonetizeMore’s proprietary PubGuru platform provides publishers with advanced tools to monitor ad performance, track key metrics, and optimize their ad setup. PubGuru uses machine learning algorithms to automate many aspects of ad optimization, such as A/B testing and ad refresh rates, freeing up publishers to focus on content creation.
• Ad Revenue Reporting: Detailed reporting provides insights into Session RPM performance, helping publishers understand which pages and ad units are performing well and identify areas for improvement.
• Dynamic Ad Optimization: They implement dynamic ad strategies that adjust in real-time based on user behavior, maximizing both engagement and revenue.
• Ad Quality Control: MonetizeMore ensures that ads served on your website are high-quality and relevant to your audience, improving user satisfaction and reducing the risk of ad blocking.

By focusing on Session RPM rather than solely on eCPM, developers can enhance their monetization strategies while maintaining a positive user experience. This shift not only leads to better financial outcomes but also fosters long-term user engagement—a critical factor in the competitive gaming market.

In conclusion, while eCPM has its place in the advertising ecosystem, Session RPM emerges as a more effective metric for assessing true monetization performance in gaming apps. By prioritizing user engagement and providing a holistic view of revenue generation, Session RPM empowers developers to make smarter decisions that benefit both their bottom line and their users’ experiences.

source https://www.monetizemore.com/blog/session-rpm-over-ecpm/