# Media formulas

CPM

Cost of 1 unit of time (commercial) x 1000

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Number of prospects reached by a given program or time period

CPP (cost per rating point) = Cost per spot / rating

Finding CPP from CPM

The relationship between CPM and CPP is expressed in the formula:

CPM = (CPP x 100) / Population 1000

GRPs = Reach X Frequency

Reach = GRPs / Frequency

Frequency = GRPs / Reach

Brand Development Index (BDI) relates the percent of a brand’s sales in a market to the percent of the U.S. population in that same market.

Category Development Index (CDI) relates the percent of a category’s sales in a market to the percent of the U.S. population in that same market.

**Formula:**

Universe

the total group of persons in a specific geographic area, that share a common characteristic.

Gross Impression

Total number of opportunities to see an advertisement, as provided by a campaign or plan.

Impression

One opportunity for one individual to see an advertisement. (AKA: Exposure)

Impression

One opportunity for one individual to see an advertisement. (AKA: Exposure)

Reach (Net Reach)

A count of persons with at least one impression.

Reach = (# persons reached / # persons in universe) x 100

GRPs = (gross impressions / universe) x 100

1 GRP = a number of impressions equal to 1% of the universe.

100 GRPs = a number of gross impressions equal to the size of the universe.

Calculate GRPs by adding up the rating points

(120/100) x 129.9 mil = 12.99 mil impressions

Universe x GRP/ 100 = impressions

Reach x Frequency = GRPs

Frequency = GRP/Reach

Reach = GRP/Frequency

Magazine plan costs $15,000 and generates an estimated 60,000 impressions.

$15,000 / 60,000 = 0.25 x 1,000 = $250 CPM

$15,000 / 60 = $250v