Your guide to digital marketing terminology

Ad Tech

Technology solutions designed to help advertisers create, place, manage, and analyze the performance of their digital advertisements.

Ad Type

The digital advertising types that brands utilize, including social media ads, search ads, display ads, native ads, and programmatic ads. Each ad type has its own benefits and requires its own strategy.

Ad Unit

The format and style that a digital advertisement will display as. Banner ads, interstitial ads, rewarded video ads, offerwall ads, and playable ads are some of the ad units available for advertisers to use.

Advertising Budget

Amount of money an organization has set aside for promotional activities, materials, and campaigns. The advertising budget should be allocated prior to building a strategy.

Advertising Cost of Sales (ACoS)

The number of clicks your Amazon Ads receive, compared to the amount of money the campaign earned for your organization. The result is expressed as a percentage. To find the ACoS of a campaign, simply divide ad spend by ad revenue and then convert it to a percentage by multiplying it by 100.

Advertising Placement

The location where a digital ad is shown. The placement of the ad is strategic, primarily wherever a business’s target audience is most likely to engage. The cost of an ad is typically dependent on its placement, and different brands tend to prefer specific placements based on KPIs, context, budget, platform, and campaign.

Advertising Platform

A tool used for serving paid digital advertisements to target audiences. Different platforms allow marketers to place ads on different websites with varying measures of control.

Advertising Server

The technology that gets ads in front of target audiences. These can be first-party (run by the same company whose site the ads will be displayed on) or third-party (run by an independent company to manage ad placements across numerous platforms).

Advertising Technology (AdTech)

Tools and software that marketers employ to target audiences, deliver messaging, and measure online advertising campaigns.

Allows retail media companies to serve targeted ads to their customers on one of the largest ecommerce marketplaces in the world and is based on the pay-per-click (PPC) model.

A type of ad targeting for use with Amazon’s Sponsored Display and Sponsored Products. Both Sponsored Display and Sponsored Products allow brands to customize ad information that displays at key locations in relevant search results.

Strategies used to build interest for a mobile app and then more importantly, convince users to download. The campaign seeks to increase the engagement of users in and out of the app, through tactics such as ads within app stores and in-app messaging.

Targeted advertisements that appears when consumers search for products on the App Store.

Average CPA

The average amount that a marketing campaign spends on achieving one conversion. Cost per acquisition (CPA) can be calculated by dividing the costs of a campaign by the number of successful conversions, whether that means new leads, new followers, or new users.

Average CPC

Determined by dividing clicks’ total cost by the total number of clicks. This helps determine the effectiveness of the campaign and informs future budgeting and strategy.

Average CPM

Average cost-per-thousand (CPM) is calculated by dividing your average advertising cost by the average number of impressions, multiplied by one thousand. This number determines the amount you are paying to reach 1,000 users.

Average ROAS

Average return on ad spend (ROAS) is determined by dividing revenue by the amount spent on advertising during a specific period of time. This metric puts a dollar amount to the return on advertising investment for a certain campaign or time period.

Benchmarks

Data that measures how ad campaigns are performing in comparison to competitors’ ads or industry averages.

Process of setting the price of bids for paid search advertisements at different levels for different entities identified via better bidding to achieve maximum ROI on advertising.

Click-Through Rate (CTR)

The frequency at which people click on an online advertisement. CTR is calculated by dividing the total number of impressions by the total number of clicks.

Conversion

When a potential customer takes a specific action—such as opening an email, engaging with a social media post, or making a purchase—on a paid advertisement. By measuring conversions, marketers better understand customers and the effectiveness (or lack) of marketing strategy.

Cookies

Browser-based programs placed on a website by a third party that are designed to collect user information about web browsing habits. In advertising, third-party cookies are usually created with the intent to target users with more personalized advertisements.

Cost Per Acquisition (CPA)

The total cost of a customer completing a specific action, such as completing a lead generation form, requesting a demo, downloading a piece of gated content, or some other form of acquisition. CPA provides a dollar amount for the cost of each time the action is performed.

Cost per Click (CPC)

The amount of money that an advertiser pays to a search engine or website each time a user clicks on one of their ads. This model is used by most search engines and forms the cornerstone of search engine ad bidding.

Cost Per Install

The price an advertiser pays to a publisher when a user downloads their mobile app after clicking on an advertisement. This metric is measured by dividing ad spend by total app installs.

Cost Per Lead (CPL)

The total cost of acquiring a new lead. CPL is calculated by dividing the advertising spend by the total number of leads acquired over the course of a campaign or designated period of time.

Cost Per Thousand (CPM)

The cost of buying 1,000 impressions on a web page. Also referred to as “cost per mille.”

Using multiple advertising channels to enhance the impact of marketing efforts across the funnel. Involves targeting the intended audience with consistent brand messaging across more than one channel to improve conversions.

Cross-Platform Advertising

Using multiple advertising channels to reach target customers wherever they are and customizing those efforts to fit each channel appropriately.

Data Management Platform (DMP)

A platform designed to collect third-party, second-party, and first-party data from both online and offline sources about customers. This data can be processed in a number of ways to give businesses a deep understanding of their customers. A DMP can be integrated with other tools to maximize its value.

Limiting ad purchases to specific days and times of the day. This strategy helps ensure that you can reach your target audience at the times they search and shop without burning through your budget too quickly at the wrong times of day.

A type of software that allows an advertiser to buy ads programmatically or with the help of automation. DSPs allow advertisers to buy high quality traffic at scale with minimal friction.

Display Advertising

Advertisements that make use of visual formats like graphics, text, and videos to engage users on the web. Display advertisements can be seen on most web pages, with the intent of enticing a user to click and be directed to a specific webpage.

A method of creating top-of-funnel awareness of an online store and products. The goal is to generate website traffic and new customer acquisition through paid placements on third-party platforms, either by targeting new prospects or retargeting those who have expressed interest.

Expanded Text Ad (ETA)

A search engine ad type that allows advertisers to display a large amount of text, providing more control of messaging. Discontinued by Google in June 2022 and Bing in February 2023, existing ETAs still work on both platforms.

A social media platform that sells advertising space where marketers can reach 2 billion users with highly relevant ads that match their behaviors and interests.

A way to target search ads to the phrases and keywords people are searching for on Google’s search engine. The three types are broad match, phrase match, and exact match.

Google Advertising

Also known as Google Ads, Google’s pay-per-click (PPC) platform helps businesses advertise across Google’s digital properties. The different ad types include search ads, display ads, shopping ads, and YouTube ads.

Hybrid Customer

A blend of two consumer types, in-person and digital, that prefers a physical shopping experience some of the time but is also comfortable shopping online. They often move seamlessly between the two throughout a single purchase journey.

Impression Share

Amount of impressions a digital advertisement receives versus how many it could have potentially received. This metric is valuable for finding out how effective advertisements are in relation to competing ads and is used to optimize ads to gain a higher impression share.

Impressions

The amount of times a specific element, such as an advertisement or social media post, appears on an end user’s interface (an app or website). Whether or not a user engages with the element, an impression is counted.

A measurement method where a marketer makes a specific change to a Test Group, as opposed to the Control Group, in order to determine the incremental value of a marketing strategy or tactic. The method is a popular alternative to using cookies and consumer data tracking.

Advertisements on the Instacart mobile app. Advertisers run featured product ads, non-search ads, and specials/promotions.

Instagram Advertising

Advertisement on the social media platform Instagram, which displays ads to users as posts from a brand page with a “sponsored” tag. Ads can be served to users as image posts, video posts, stories, IGTV ads, reels, explore ads, collection ads, carousel ads, and collection ads.

JavaScript

The most popular programming language used for website development. It’s relatively easy to learn, and marketers often add tracking codes and for data collection to understand the performance of campaigns.

KPI (Key Performance Indicator)

Measurable values used to track progress toward a specific goal or objective. Within digital marketing, common KPIs include web traffic, leads, cost per lead, conversion rate, click-through rate, customer acquisition cost, and more.

Last-Click Attribution

Model that gives 100% of the attribution to the marketing touchpoint a customer last clicked on or engaged with before making a purchase.

Lifetime Value (LTV)

A measure of the total income a business can expect to bring in from a typical customer for as long as that person or account remains a client.

LinkedIn Advertising

A paid digital marketing tactic that allows companies to reach and nurture target audiences by serving ads on the business-focused social media platform.

Determines how closely your lookalike audience will resemble an original group of users. A lower percentage will result in a more homogeneous audience; a larger percentage leads to a broader audience.

Machine Learning

Artificial intelligence (AI) technology that is programmed to adapt in a way that resembles human learning. Types include supervised, unsupervised, and reinforcement learning.

Microsoft’s pay-per-click search engine marketing system, which allows advertisers to display search ads to users on Bing, MSN, and Yahoo.

Mobile Marketing

A crucial avenue for reaching target audiences on devices like smartphones and tablets through tactics like SMS, email, social media, and mobile app advertising.

Mobile Marketing Attribution

The process of matching data points to create an understanding of what happens when a user interacts with a mobile ad. Comprehensive mobile attribution covers the entirety of the conversion funnel. It identifies and reports whether a user reacts upon seeing an advertisement, if a user installs an app after seeing an ad, and how a user behaves after taking a specific action.

A marketing measurement method that gives weight to every touchpoint along a customer’s journey. Gives credit to each advertisement used to push a customer to the buying decision.

Native Advertising

A type of paid advertising where the ads mix seamlessly with the editorial content, like a news outlet with sponsored article by a brand alongside regular content, or YouTube sponsored video ads appearing alongside content in the feed.

A marketing strategy that covers all (or as many as possible) channels that potential customers can be found on. In a true omnichannel strategy, data from all platforms is connected and analyzed to inform how advertisers use each channel to get maximum benefit and optimize resources.

Open Web

The public side of the internet where all users can participate and contribute rather than being controlled by gatekeepers or government regulation.

Running advertisement campaigns on Pinterest, an image sharing and social media platform built around visual “pins” and “pinboards.”

PPC Advertising

The pricing model favored by most search engines. The advertiser agrees to pay a set amount for each time a user clicks on the advertised link.

Quality Score

The way paid search ad platforms “rate” ad content, which directly impacts the price per click and price per conversion within each respective platform.

Retail Analytics

The practice of gathering data about sales, customers, supply chains, inventory, and more in order to draw conclusions about what is working and what isn’t, and help businesses build successful marketing strategies.

Advertising clearly labeled products directly on a retailer’s website, designed to reach consumers where they’re shopping.

Retargeting

Cookie-based technology that uses website code to remarket to specific audience members based on their behavior on the internet. Each time a user visits your site, pixels will identify how they got there and register the user as someone potentially interested in your product or service. This information is then used to “retarget” these users with future advertising initiatives.

Return on Ad Spend (ROAS)

The amount of revenue generated compared with the amount spent on advertising. To calculate ROAS, divide your campaign revenue by the cost of the ads.

A marketing technique that displays paid ads in relevant search results based on search queries for the advertiser’s desired keywords. Advertisers bid on search terms through a pay-per-click (PPC) method.

Search Engine Marketing (SEM)

The practice of marketing a business or product using paid advertisements that appear on search engine results pages (SERPs). Advertisers bid on search engine keywords, giving them the opportunity to appear front and center on the SERP. SEM ads are pay-per-click (PPC), meaning there is an average cost per each time a user clicks through the ad.

A marketing strategy that focuses on every step of the shopper journey, from awareness to purchase, and even post-transaction.

A conversion rate optimization process in which all changes and investments are hypotheses that are tested. A test-and-learn culture designs experiments, observes the results, and makes decisions based on findings.

TikTok Advertising

Placing advertisements on the TikTok social media platform. Ads target viewers based on demographics, interests, and behaviors. The ads are served to the target audience in the form of sponsored videos, ads in the For You feed, hashtag challenges, or promoted trends.

User Acquisition

Obtaining new mobile app users through digital marketing. Similar to lead generation, wherein an app developer creates a strategy that uses data to craft effective strategies to gain new users.

Vertical

Organizations that serve a specific niche, such as healthcare, cybersecurity, or manufacturing. Companies in the same vertical often compete with one another. Advertisers typically employ different strategies to reach different verticals, aligning their strategy with their customers’ unique needs.

Walled Garden Advertising

A type of advertising where the owner of the publishing platform has total control over the tech, the reporting, and the serving and tracking of the content that users have access to. Walled gardens can collect large amounts of data on users, which is used to target potential customers.

Purchasing search, display, and in-store ads via Walmart Connect for products to be displayed on walmart.com.

XML Sitemap

A file used to make a website’s pages crawlable by search engines. While most pages get crawled automatically via backlinks, this isn’t always the case. An XML sitemap ensures that search engines are crawling the pages that you want them to and, inversely, allows you to exclude any pages that you might want to keep off of search results, like content kept behind gated pages.

YouTube Advertising

Pay-for-placement advertising on Youtube, an online video-sharing social platform. Ad buys include videos, banners, or text, and can be shown pre-video, displayed while video plays, or off to the side of the page. Ad buys are only possible through Google Ads.

Zero-click Queries

Occurs when a search result to the answer to a user’s query is displayed on the results page. With the answer being shown on the results page itself, the user does not need to click into any search result.

Zero-party Data

Data collected via surveys, preference settings, and other direct methods volunteered by a customer. This data is valuable because it doesn’t transgress user privacy, and it is considered more accurate than other forms of data.

1-Party Data

Data gathered directly from customers through channels like purchase history, website usage, or social media data. First-party data comes straight from customers, which makes it the most accurate customer behavior data.

2-Party Data

First-party data that a company receives or purchases from a business partner. While the data is gathered by someone else, it’s still highly accurate for the same reason first-party data is: It consists of customer behavior data information such as purchase history, website usage, and social media.

3-Party Data

Data purchased from an organization that did not collect it themselves. Data sets consist of demographical information used to find target audiences for marketing campaigns.