How is cost per point calculated?

Cost per point is a key metric in advertising that helps determine how much it costs to reach one gross rating point (GRP) in a campaign. GRPs measure the total exposure of a campaign by looking at the percentage of the target audience reached multiplied by the frequency of the ads.

To calculate cost per point, the total cost of the advertising campaign is divided by the total gross rating points (GRPs) generated by that campaign. This provides advertisers with a clear understanding of the efficiency and effectiveness of their ad spending in terms of audience reach.

The reason this calculation is significant is that it allows for comparisons across different campaigns and media types, enabling advertisers to assess cost efficiency in delivering audience impressions. By focusing on GRPs, which takes into account both reach and frequency, advertisers can get a more nuanced view of their advertising efforts rather than just looking at raw impressions or revenue.

In contrast, the other options do not accurately represent how cost per point is defined or calculated within the context of advertising metrics.