CTR, Conversion Rate, CPC, CPA, CPM

Every industry has acronyms cryptic to lay-people and new-comers, but it seems that digital marketing has more than it’s fair share. In order to level the playing field and allow for better comprehension and communication, we thought we would put together an index of the more important terms.

-PPC: Pay Per Click, often used to refer to paid search advertising.

-SEM: Search Engine Marketing, another acronym that refers to paid search advertising.

-SERP: Search Engine Results Page, the page shown after submitting a query on a search engine.

Structural

  • Account: Top structural level of AdWords. Typically one account per business. An AdWords account can have one or more campaigns (of all types) running.
  • Campaign: This is where the budget and targeting settings live. Campaigns are generally structured around broad categories or products and services.
  • Ad Group: The structural level where ads and keywords live. These are intended to be as tightly themed around specific products and services as possible, so as to show the most relevant ad copy to the keyword/search term.
  • Ads: The text or image shown to the searcher.
    • Text Ads: These ads appear on SERP page alongside organic search results.
      • Headline: The top line of a text ad, 25 characters in length.
      • Description Lines 1 & 2: The following two lines of the text ad, 35 characters in length.
      • Display URL: The URL that is shown to the searcher. Must match the domain of the landing page that searchers are sent to if they click the ad. 35 characters in length.
      • Destination URL: The actual URL for the page you wish searchers to be directed to if they click your ad.
    • Product Listing Ads (PLA): This type of ad shows an image of a product, as well as the product name, price, and your company name. It is a highly effective way of advertising products online.
    • Display Ads: These ads display an image, or rich media, that links to your site. These are placed on any website that advertises with Google.
  • Keywords: A set of words that live within Ad Groups that trigger ads to be shown to a searcher based on their search term.
    • Negative Keywords: Another set of words, whose presence in the search term exclude your ads from being shown on the SERP.
    • Match Type: The rule regulating how your keywords are matched to search terms.
      • Broad: This match type will allow Google a good degree of latitude in determining whether search terms are relevant to your keywords. If you’re trying to run an efficient campaign, use caution with this match type.
        • Example: the keyword “piano lessons” under broad match could match to “cheap piano lessons”, “piano tuning”, “pianos”, “cooking lessons”, or “piano tuning classes”.
      • Broad Modified: This match type allows you to lock in certain elements of the keyword with a plus sign. This means that the search term can contain any additional words, and the ‘modified’ elements of the keyword can appear in any order as long as all are present. This is a good way to maximize the amount of exposure your keywords receive with less irrelevant traffic than broad.
        • Example: the keyword “+piano +lessons” under broad match could match to “piano lessons near me”, “lessons from piano teacher”, “lessons for piano online”, or “lessons on tuning a piano”, but not “piano classes”.
      • Phrase: This match type will match if the keyword appears exactly as contained within the search term. This is a good tool if the way in which a search term is formulated shows searcher intent or difference in meaning
        • Example: the keyword “piano lessons” under phrase match could match to “local piano lessons”, “piano lesson teacher reviews”, “why piano lessons for kids?”, or simply “piano lessons”, but not “lessons for piano”.
      • Exact: This match type means that ads will only be triggered if the search term is nearly identical (plurals and common misspellings are matched). This is the way to go if you want to be entirely specific.
        • Example: the keyword “piano lessons” under exact match could match to “piano lesson”, “piano lesons”, or “piano lessons”, but not “local piano lessons”.
  • Landing Page: The page to which a click on your ad is directed.

Metrics

  • Clicks: The amount of clicks within a given period of time on an account, campaign, ad group, ad, or keyword.
  • Impressions: The number of times your ad has appeared within a given period of time on an account, campaign, ad group, ad, or keyword.
  • Click Through Rate (CTR): The number of clicks divided by the number of times your ad has appeared within a given period of time on an account, campaign, ad group, ad, or keyword.
  • Bid: The same as Max CPC, the maximum amount of money you are willing to pay for a click.
  • Cost/Spend: The total amount spent within a given period of time on an account, campaign, ad group, ad, or keyword.
  • Maximum Cost Per Click (Max CPC): The maximum amount of money you are willing to pay for a click. While this essentially works on the keyword level, you will be asked to set a default Max CPC on the ad group level.
  • Actual Cost Per Click (CPC): The amount you actually end up paying for a click. As Google employs a generalized second-price auction, you will usually pay less for the click than the maximum that you had set, as it takes into account the bids of your competitors as well as other factors.
  • Average Cost Per Click (Avg CPC): The average amount spent per click during a given period of time within an account, campaign, ad group, or for an ad or keyword.
  • Cost Per Thousand Impresssions (CPM): A metric used primarily for Display campaigns these days, this is the amount spent for an ad or group of ads to be triggered a thousand times.
  • Conversions: the number of times a desired action is completed, usually either submitting a contact form, calling, or purchasing something. This is the end goal of the advertising campaign, and is often equated with effectiveness.
  • Converted Clicks: As there can often be more than one way a searcher can convert on your site, this metric refers to the number of visitors to your site that convert, rather than the number of conversions.
  • Cost Per Acquisition (CPA)/Cost Per Lead (CPL): The amount spent per conversion during a given period of time within an account, campaign, ad group, or for an ad or keyword.
  • Conversion Rate (CR): The amount of conversions divided by the number of clicks. This metric signifies the proportion of visitors to your site that complete a desired action.
  • Ad Position/Page Rank: The position on the SERP in which your ad appears.
  • Average Position: The average position on the SERP in which your ad appears.
  • Ad Rank: The value that is used to determine the Ad Position in relation to your competitors. This is calculated using your Max CPC and the Quality Score of your keyword.
  • Quality Score (QS): A complex value assigned to your keyword by Google based on a number of factors, including your past CTR (adjusted for position), landing page content relevance and ease of use, relevant ad text, and past geographic performance. This value exists to reward advertisers creating a high quality experience for searchers.
  • Impression Share (IS): The number of impressions received divided by the number of impressions your keywords would have received if budget, bid, and page rank were not factors.
  • Bounce Rate: The percentage of users who exit your web page before clicking through to another internal page. This metric roughly equates to poor user experience and/or irrelevant content.
  • Return on Investment (ROI): The profit or loss of a project divided by the amount invested.
  • Return on Ad Spend (ROAS): The profit or loss of a project divided by the amount spent on advertising.

Features

  • Ad Extensions: An ad format that displays extra information to the searcher about your business. The higher your ad appears on the page, the more likely that these extensions will show. The following are the different types of extensions available on AdWords.
    • Call (Click-to-Call) Extensions: Displays your business number. If the search was done on a mobile device, the searcher can click the number to place a call.
    • Location Extensions: Displays your business address.
    • Callout Extensions: Displays additional information about your service, such as offers, promotions, or special pricing.
    • Sitelink Extensions: Displays additional links to other pages on your website, so the searcher can better find the information they’re looking for.
    • Review Extensions: Displays reviews from third-party sources.
    • App Extensions: Displays a link that showcases your app.
    • Social Extensions: Displays the number of Google+ followers you have.
  • AdWords Campaign Experiments: Feature in AdWords that allows you to test the performance of variations within a campaign by alternating between versions for a specified proportion of auctions. These variations could be alternate sets of keywords, bids, ads, negative keywords, match types, and ad groups.
  • AdWords Editor: A free software offering from Google that allows bulk edits to be implemented offline.
  • Automated Rules: Feature that adjusts budgets, bids, or statuses based on rules set by the account manager according to the goals and needs of the account.
  • Change History: Feature that details all changes made to the account for a time period of up to two years.
  • Dynamic Keyword Insertion (DKI): Feature that allows the insertion of whichever keyword that triggered your ad to appear into your ad copy.
  • Google Forwarding Number (GFN): A unique phone number provided by Google that forwards to your business number and allows calls to be tracked as conversions in AdWords.
  • Remarketing: Targeting strategy that allows you to display highly relevant ads only to users who have previously visited specific pages of your website.
  • Search Term/Query Report: Found in the ‘Details’ drop-down menu within the keywords tab, this report shows a table of search terms within an account, campaign or ad group for a designated period of time.
    • Search Term/Query: The submission entered into the search bar by the user.
  • Shared Budgets: Feature that allows a single budget to be shared between multiple campaigns, allowing for spend to swing between campaigns dynamically, depending on day-to-day click performance.

Settings

  • Ad Delivery: Setting that primarily affects campaigns that are limited by budget. Google will by default spread your ad’s appearance throughout the day, skipping some auctions to preserve the budget. If you decide to switch from standard to accelerated, Google will not skip auctions and your ad will appear for all relevant searches.
  • Ad Rotation: This setting allows you to choose how Google decides which ad to show in an auction if you have multiple ads in an ad group. You can ‘Optimize for Clicks’, ‘Optimize for Conversions’, ‘Rotate Evenly’, or ‘Rotate Indefinitely’.
  • Ad Scheduling: This setting allows you to set start and end dates for a campaign, as well as choosing exactly when you want your ad to show through the course of the day. You can even put bid modifiers on designated time periods.
  • Audiences: Lists of visitors to your site that you intend to remarket to. These lists should be as specific as possible, distinguishing what pages they’ve visited and where the traffic originated if possible.
  • Bid Types: There are several bid settings within AdWords. If you don’t want to set and adjust each keyword’s bid manually, you can choose for Google to automatically adjust bids to ‘focus on clicks’, ‘focus on impressions’, or ‘focus on conversions’.
  • Daily Budget: The amount of money you are willing to spend per day on a campaign. This budget can be exceeded by up to 20% depending on click activity.
  • Client ID: Each account has a unique ID number. This is visible on top of all AdWords pages.
  • Geo-Targeting: This setting feature allows you to target searchers situated or searching about specific geographic areas, and exclude searchers in other regions. You can also choose to only target searchers located within the area rather than just searching about it.
  • Search Network: Search related websites, including Google and it’s search partners.
  • Search Partners: Websites that show AdWords advertisements in the same manner that they are triggered through a Google search.