What is CPE?
CPE or Cost Per Engagement is an advertising pricing model. CPE model means that an ad is paid only when it’s engaged with, as opposed to other payment models such as CPC and CPM.
This is an appealing and beneficial ad payment model for advertisers who can choose between models that charge per each engagement (which can be closing the ad), or meaningful engagement (clicking-through and positively interacting with the ad).
For example, publishers can charge on a CPE basis whenever users hovered over a lightbox ad for longer than 2 seconds and expanded it. Another example of CPE pricing is publishers charging only when users have spent more than 15 seconds on the ad’s landing page.
CPE can also stand for Cost Per Expansion with expandable ad campaigns. This is closely related to the standard CPE, as it presumes that a user is engaging with the ad by expanding it, where applicable.
The CPE payment model rose in popularity through social media. It’s also possible to simply measure CPE instead of opting for that payment model. This is especially true and useful with CPC campaigns where your main focus is clicks.
The formula for calculating CPE is:
CPE = Total amount spent/Total engagements