If you are new to the field, you may be overwhelmed by the different types of digital advertising acronyms. Get the head start with our guide to digital advertising acronyms. Understanding these terms and their meanings is can be key to building an effective marketing campaign, and we’re here to help.
CPA: Cost Per Action refers to how much an advertiser pays for a particular “action”, whether it’s a conversion, click, impression, form fill-out and more.
KPI: Key Performance Indicator(s) relates to business goals. KPIs determine how well a campaign, tactic or similar marketing activity is supporting key business goals.
CPM: Cost Per Impressions refers to how often an ad is displayed. Marketers pay for CPM when a 1,000 potential consumers have viewed the ads.
WOM: Word-of-Mouth marketing is the most effective type of marketing – marketers don’t have to pay for it, and it comes from people’s influencers or peer groups. It’s the equivalent of a referral.
PPC: Pay Per Click and CPC are practically interchangeable these days. Advertisers bid in real time on a particular keyword or keyword phrase. If they win the bid, their ad is shown. If someone clicks on the ad, the advertiser pays for that click.
VTC: View Through Conversion means that someone saw the ad, but didn’t click on it. Then, the user went to the site within a designated period of time (typically 30 days) and converted.
CPL: Cost Per Lead means that advertisers only paid when a particular user performs a specific action. Typically, this is only used for lead generation.
CTR: Click Through Rate is the number of clicks that an ad receives divided by the number of impressions. This is used to determine how well a piece of advertising is doing compared to the number of people viewing it. If an ad is getting a lot of views, but not clicks, then messaging, imagery and/or targeting may have to be tweaked.
ROI: Return on Investment is a success metric that determines how profitable a tactic or campaign is. It’s commonly calculated as gain from investment (i.e. sales) minus the cost of the investment divided by the cost of investment.
CTA: Call To Action tells the user to do something – i.e.,“learn more” or “call today.” These are used on everything from emails to websites to advertising.
SLA: Service Level Agreements define the level of service that a user can expect from a service provider, i.e. an Internet Service Provider (ISP). This can include downtime, average repair times and responsiveness.
DSP: Demand Side Platform is a software program that allows for automated real-time bidding and purchasing of advertising. It includes purchasing all types of inventory from multiple ad exchanges, including video, display, search, mobile and social ads.
RTB: Real Time Bidding involves the buying and selling of impressions using automated real-time, programmatic auctions. These auctions take place in less than a second while a web page is loading.
LTV: Lifetime Value helps marketers determine the true value of a customer and how much they’re willing to spend to acquire a particular lead. For example, let’s say it costs $100 to acquire a lead, but that lead has signed up for a monthly subscription service for $30/month. By the fourth month, the value of this customer will exceed what it cost to acquire the customer. If that calculation were reversed, however, that customer wouldn’t be worth the cost in the long-run.
ROS: Run of Site allows ads to appear on any page of a website. This type of inventory is usually less expensive, and ads are rotated across pages.
SEM: Search Engine Marketing is an umbrella name for any type of marketing that improves the visibility of websites within search engine results pages (SERPs). This can include anything from paid search to SEO.
CRO: Conversion Rate Optimization is an automated way to try and increase conversions by sending visitors that are more likely to take an action (conversion) to a website or landing page. CRO systems review analytics, response rate and user feedback to show ads and content to relevant visitors, improving ROI.
SEO: Search Engine Optimization is a method of improving visibility in SERPs and driving traffic to a website via non-paid methods. This is known as organic traffic. SEO includes on-site optimization of content, creating new content and adding meta information to the backend of websites.
SOV: Share of Voice is a percentage metric that shows how well companies perform against competitors in terms of social media, discussions, content, paid avenues, SEO and more.
ASP: Application Service Provider is company that offers businesses or individuals access to certain applications and services via the Internet.
BR: Bounce Rate is a percentage metric that shows how many people immediately leave (or “bounce”) from a website after either only visiting one page or spending a short amount of time on the site. A high bounce rate could indicate issues with navigability, UX or ad messaging.
CMS: Content Management System is a software program that allows users to create, edit and publish online content. These systems typically allow for multiple users to work on projects simultaneously.
MRR: Monthly Recurring Revenue ensures company profitability. This is an income stream that a company can forecast coming in on a month-to-month basis.
CSS: Cascading Style Sheets is a style sheet language for content. It allows users to add colors, fonts, spacing and other types of formatting to all types of documents.
DMP: Data Management Platform allows for large data sets to be collected, sorted and controlled. It is a type of data warehouse that segments data into useful chunks that can be used for a variety of functions, including programmatic advertising.
While there might be many other acronyms floating around online, these are the most important ones for marketers to know and understand. Many of these are currently used in success analytics as well as in online marketing technologies.