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Advertising Terminology
Ad Network: An advertising company that handles serving, tracking, and payment collection for online advertising campaigns. The “network” connects the websites that have available space for showing ads to the advertisers that need that space to show their ads, collects the fees for serving the ads from the advertiser, and gives a percentage to the publisher websites for their services placing the ads on their pages.
Advertiser: A website that places advertisements for its product on other websites (publisher sites) for the purpose of getting more visibility and sales for their product. The Advertiser pays a commission to the publisher websites in exchange for showing their advertisements.
Analytics: The numerical data that is gathered by taking the number of times a specific advertisement was placed on web pages and comparing that to the number of times it was clicked on and the number of times that the click on the ad resulted in the desired action (a sale of a product, a sign-up for a mailing list, etc.).
Banner: Specifically this can refer to the long, horizontal, 728 pixel wide by 90 pixel high advertisement that is typically seen at the top of a web page. In more general terms, “banner” can refer to any size of online advertisement.
Campaign/Promotion: A group of advertisements that is comprised of similar creative assets and set to run within a specified budget and a specified time frame. It can also encompass specific publisher sites and targeting methods to be used for that group of advertisements.
Clicks: An interaction with (click on) an advertisement that results in that user visiting the advertiser’s web page.
Click-through: Same as “click”: a user interacts with an advertisement and “clicks through” to the advertiser’s web page.
Cookie: A tiny text file that is placed on a user’s computer so that a website can keep track of a user’s preferences. Many sites that show a user personalized information every time they return to a site accomplish that by leaving this text file on the user’s computer and reading that text file the next time the same user returns to the site.
Conversion: A click-through to an advertiser’s website that results in a sale of that website’s product. Conversion, or making a sale, is the overall goal and measure of success of most advertising campaigns.
Conversion rate: The percentage of users clicking through to an advertiser’s website that result in a sale of that website’s product. If 1,000 users click through to a website and 10 of those users buy that site’s product, the conversion rate is 10/1000, or .01 (1%).
CPC (Cost Per Click): An advertising pricing model that charges the advertiser every time one of their ads is clicked on.
CPM (Cost Per 1,000 Impressions): A pricing model based on a cost for every 1,000 times an ad is shown on publishers’ websites (M is the Roman numeral for 1,000). This cost model is usually associated with branding campaigns that are more interested in visibility and exposure than in click rates.
CTR (Click-Through Rate): The percentage of internet users that click an advertisement after seeing it shown on a web page. If an advertisement is shown 1000 times and 20 users click on it, the CTR is 20/1000 or .02 (2%).
Display Ad: Also known as a “banner ad”, a display ad is a static or animated graphical advertisement that is placed across the top or down the sides of a web page and that hyperlinks to the advertiser’s site when clicked. This is in contrast to a “text ad” or “search ad” which is usually comprised solely of text and hyperlinks.
Impressions: The number of times an ad was seen by visitors to the website showing the advertisement. Each visitor to the site triggers a showing of an advertisement and the total number of showings of that ad are referred to as the “impressions” that ad received.
Media: The photos, video, and audio that you use to represent your business in a promotion.
Media Cost: The amount of money spent on a given advertising campaign.
Monetize: To convert something to money. In Internet terms, monetize refers to finding a way to generate income from items posted on the web.
Optimization: The act of observing the performance of a particular advertisement and learning where that advertisement performs best, then keeping that advertisement showing in those places where it is performing well.
Publisher: A website that adds space on their page to show advertisements in exchange for a commission. The commission is paid as a percentage of the amount of money the advertisers spend to show their ads in that space.
Targeting: The act of trying to identify users that are interested in a specific product or users that are in a specific geographic location.
Traffic: The aggregated group or number of web users that visit a given website.