Marketers love their jargon, and it’s easy to get lost among the acronyms and terminology. I made invited our paid media team to sit down and explain what it all means in plain language so that we regular humans can understand the local lingo.

Do you know your CPA from your CPC? Is your CTR better than your CPM? If you’re ready to throw a brick at your screen just reading this nonsense, calm down, because we’re about to deconstruct all the industry talk and make some sense out of this.

 

Our paid search glossary:

A

Average position: Want to tell if your ad is beating others? The average position indicates how your ad ranks against others and where it appears.

Average Transaction Value: The average dollar amount that a customer spends with you on your website, within a single transaction.

 

B

Bounce Rate: The bounce rate tells you the percentage of single-page sessions in which there was no interaction with the page.

 

C

Campaigns: A set of ads, keywords, and bids that share a budget, location targeting, and other settings. Campaigns are often used to organise categories of products or services that you offer.

Clicks: When someone clicks your ad, like on the blue headline of a text ad, AdWords counts that as a click. Clicks can help you understand how well your ad is performing. Relevant, highly-targeted ads are more likely to receive clicks. Click can include: headlines and ad extensions.

Conversions: A specific customer action that you’ve defined as valuable to your business.

Cost Per Acquisition (CPA): Otherwise known as Cost Per Action or Cost Per Conversion, this refers to the average amount you pay for each conversion generated through your advertising activities. For example, Sally created an online campaign that cost $200. A total of 20 sales were attributed to the campaign. Therefore, the CPA is $10 ($200/20 sales).

Cost Per Click (CPC): Ads placed on search engines such as Google aren’t free. Advertisers are charged a certain amount of money every time their ad is clicked (up to the amount nominated by the advertiser), resulting in visitors being led to the advertiser’s website. In simple terms, it’s the average amount you pay for each click on your ads.

Cost Per Thousand (CPM): CPM refers to the cost per thousand ad impressions. Advertisers can set CPM bids, which tells the platform how much you’re willing to pay for that set of impressions. CPM is often used when you want to raise brand awareness.

Click-Through-Rate (CTR): CTR is the proportion of visitors who clicked through to your website after they were served an ad impression. It looks at both the number of clicks an ad receives and the number of times the ad is displayed. CTR= number of clicks/number of impressions x 100. So, if your ad received 10 clicks and had 150 displays/impressions, your CTR = 6.7%.

Conversion Rate: The average number of conversions per ad click, shown as a percentage.

 

D

Display Ads: Display ads are visual advertisements placed on websites across the Google Display Network. These ads are created and managed by the advertisers and are placed on websites that are most relevant to your audience.

Image of a display ad.

An example of a display ad.

G

Google Display Network: A group of more than two million websites, videos and apps where your ads can appear.

 

I

Impression: How often your ad is shown. An impression is counted each time your ad is shown on a search result page or a website. So if your super cool ad for men’s shorts was shown 50 times, you received 50 impressions!

Impression Share: How often you received an ad impression for each search term, as a proportion of the total number of available searches available for that term.

 

K

Keywords: Words or phrases describing your product or service that you choose to help determine when and where your ad can appear.

 

N

New Users: The total number of unique visitors who had not previously been to your website before.

 

P

Pay Per Click (PPC): Sounds just like CPC, doesn’t it? While the two terms are very similar, PPC is more of a general term used to describe the type of advertising where advertisers pay for each click on their ads. You can have a PPC campaign, and then a specific CPC for each ad within that campaign.

Post View Sales/Conversions: The number of users who saw your ad, but did not click and went on to convert through another marketing channel.

 

R

Returning Users: The total number of users who visited your website more than once.

Return on Investment (ROI): ROI is generally presented as a percentage, and will look at the performance of an activity in relation to a business’s bottom line.

Return on Ad Spend (ROAS): ROAS is a calculation used to describe the direct profits from advertisements. To calculate ROAS, you take the revenue attributed to your ads, and divide that figure by the costs associated with creating and placing the ads.

 

S

Search Engine Marketing (SEM): SEM is a broad term used to describe the promotion of websites or businesses by improving their visibility in search engines. SEM tends to relate specifically to paid advertising. Ideally, search engine marketers try to get their ads visible to the right people (i.e. people likely to use their product or service) at the right time (e.g. when they are looking for information or ready to make their purchase).

Search Query: Terms that people have used before seeing your ad and clicking it. “Buy men’s shorts” is an example of a search query, as is “doctors in Newstead”.

Sessions: The number of user sessions is the measure of how much traffic your website has received.

 

This isn’t an exhaustive list of terms and definitions yet, but we promise that we’re working on it! Looking for a specific term that wasn’t on the list? Send a message our way and we’ll add it in ASAP so you can sleep at night. That’s the Search Factory promise to you.

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