Effective CPM

My business partners and I have been experimenting the past few days with Google Adsense.  You may have noticed the small un-obtrusive Google Sponsored Links at the bottom of my blog posts.  My partner Greg is also running these on his website. 

Being somewhat new to Adsense, I know I am late to the plate for this one, I am getting myself acquainted with some of the terminology and lingo associated with Adsense. 

If you currently have Adsense running you might have already seen the terminology “Effective CPM” in your account administration area before.  Basically what Effective CPM tells you is what your estimated revenue is going to be based on 1000 impressions.  Here is the explanation I found from Google:

From a publisher’s perspective, the effective cost-per-thousand impressions (eCPM) is a useful way to compare revenue across different channels and advertising programs. It is calculated by dividing total earnings by the number of impressions in thousands. For example, if a publisher earned $180 from 45,000 impressions, the eCPM would equal $180/45, or $4.00. However, please keep in mind that eCPM is a reporting feature that does not represent the actual amount paid to a publisher.