PPC Terminology 101 | Pay Per Click Advertising


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To get the most out of your PCC campaign its important to familiarize yourself with the terminology used by professionals. We've put together a PCC Terminology handbook to help you maximize your online marketing efforts.

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PPC Terminology 101 | Pay Per Click Advertising

  1. 1. PPCTERMINOLOGY 101www.clickxposure.com
  2. 2. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosureAlthough it’s the fastest growing marketingchannel, online marketing is still relativelynew. Moreover, online marketing comeswith a slew of terminology that can be attimes overwhelming and confusing to theaverage person.Among the various online marketing strategies, Pay-Per-Clickadvertising, or PPC, offers targeted advertising for the purpose ofgenerating more exposure, more traffic and more leads for businessesand organizations wishing to strengthen their online presence.
  3. 3. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosureBefore launching a PPC campaign, or if you want to get more out of yourPPC campaign, it’s important to understand the terminology behindPPC. Understanding the various terms and concepts can help you betterunderstand your campaign’s structure and performance metrics.Here’s a list of basic PPC terms to help you navigate the intricacies ofyour PPC campaign and online marketing
  4. 4. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure01. Ad Copy02. Ad ExtensionsAs its name implies, the ad copy is the actual text that makes up yourPPC ads. This includes the headline, descriptive text and a displayURL. The best ad copy uses relevant keywords, a compelling offerand call-to-action to influence people to click on your ads and visityour website.Ad extensions provide additional information about your businessand/or products to compel people to click on your ad. Popular adextensions include location extensions, site extensions and callextensions. The effectiveness of ad extensions depends greatly onyour particular goals and your type of business and industry.
  5. 5. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure03. Ad Group04. Ad Scheduling / Day PartingAd groups are an essential part of your campaign structure. An adgroup is a collection of relevant and related keywords and theirspecific ads. A well-built campaign should have multiple ad groupsthat are keyword-themed.Ad scheduling, also known as day parting, allows you to controlwhen your ads run. After testing how well your ads perform atdifferent times of day and days of the week, it’s smart to structureyour campaign to run at peak times when you receive the mostvaluable traffic. This allows you to conserve your budget formaximum profitability
  6. 6. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure05. AdWords06. Bid PriceAdWords is Google’s paid advertising program, which includes PPC,CPM, remarketing and display ads. Given that Google has the largestmarket share among the other search engines, AdWords is commonlyassociated with online marketing.The bid price is the maximum amount of money you are wiling to bid(pay) for each of your particular keywords. Bid prices vary dependingon industry and can range anywhere from a couple of cents to $70 perclick. Understanding the competitiveness of your industry and chosenkeywords is important for budgeting. A bid price that is too low willprovide no visibility or very poor visibility for your ad.
  7. 7. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure07. Bounce RateAlthough not directly related to PPC, the bounce rate is a statisticregarding website visitor behavior. The percentage represents thenumber of people who visited your website but leave without visitingadditional pages. A high bounce rate should be analyzed closely as itmay mean that the content of your ads and your website or landingpage is not relevant. For optimal conversions, PPC ads and theirdestination URL or landing page should have related content.
  8. 8. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure08. Broad Match09. ClickBroad match is a match type used in determining when your ads shouldbe displayed according to particular search queries and keywords.Broad matching triggers your ads to show for any search that containsthe keyword entered and associated searches including relevantvariations such as misspellings. For example, if your selected keywordwas “dress shoes,” your ad may be triggered for searches for “dressshoes,” “running shoes,” “buy dress shoes,” “dress shoe polish,” andother similar searches.Simply put, a click is the action of someone clicking on your PPC ad.The number of clicks your particular ad receives depends on a varietyof factors including ad copy, ad ranking/position, and the number ofqueries for your particular keywords. Although more clicks are alwaysbetter, click quality is also important.
  9. 9. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure10. Click-Through-Rate (CTR)11. Content NetworkThe click-through-rate is another valuable statistic regarding yourcampaign’s performance. A high CTR is an indication of a well-builtcampaign with relevant ads. The rate is calculated by dividing thenumber of actual clicks your ad received by the number of impressions,or the number of times your ad was shown.The content network is the available advertising real estate whereadvertisers can display their ads. All major search engines have acontent network that includes other websites, blogs and other siteswhere advertising is available. If you are running display ads, you canexpect your ads to show up on any of the websites that form part ofyour chosen search engine’s content network.
  10. 10. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure12. Conversion13. Conversion RateConversions are important goals for advertisers. They are equivalentto leads and can be defined in a variety of ways depending on theparticular goals of each individual advertiser. Examples of conversionsinclude making a purchase, submitting a form, downloading a freereport or signing up for a newsletter.The conversion rate represents the overall effectiveness of yourcampaign. It is calculated by dividing the number of clicks your adreceived by the number of visitor interactions on your website, whichcould be defined as a sale, a form submission or requesting afree download.
  11. 11. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure14. Cost-Per-Click (CPC)15. Cost-Per-Lead (CPL)The cost-per-click or CPC is the actual dollar amount you spend foreach individual click your ad receives. The CPC is affected by thecompetitiveness of your particular keywords, your CTR and QualityScore of your ads.The cost-per-lead is the dollar amount you end up paying to searchengines such as Google for each individual lead generated by using theironline advertising platforms. It is essentially the cost of acquiring a lead.Your CPL should be aligned with your marketing goals and the expectedprofit from each new lead.
  12. 12. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure16. Cost-Per-Thousand-impressions (CPM)17. Daily BudgetDepending on the particular online advertising platform, the cost ofyour online ads may be based on the number of times it was shownand not the number of times it was clicked as in PPC. Advertisers suchas LinkedIn offer a CPM method that allows you to pay a for each onethousand ad impressions (the times your ad is shown), regardless ofhow many clicks your ad receives.The daily budget for your campaign is the maximum amount of moneyyou are willing to spend on a daily basis. When your daily budget runsout, you ads stop showing. Your daily budget limits how much you spendfrom day-to-day and allows you to budget your marketing spending.
  13. 13. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure18. Exact Matching19. Geographical/Location Targeting (Geotargeting)Exact matching ensures that your ads are displayed only for searchescontaining your selected keyword or keyword phrase. For example, ifyour keyword was “mountain bike,” your ad would only show up forsearches for “mountain bike” and would prevent your ad from showingup for searches such as “bike for mountain” or “mountain bikes.”Geographical/location targeting, also known as geotargeting, allows youto select the geographic area where you wish to advertise. A geotargetedcampaign can be as wide as international or as narrow as a 5-mile radiusof your business location. Depending on your goals and business type,geotargeting can be an effective way of targeting just the right prospects.
  14. 14. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure20. Impressions21. KeywordImpressions are the amount of times your ad was served (shown) inresponse to a particular search term, and essentially, how many timesyour ad was visible to people. With PPC, the higher the impressions thebetter as you want your ad to be shown as often as possible. However,impressions are not everything. Attracting clicks is the next step.A keyword is a term, word or phrase within a search query. Keywordstrigger your PPC ads to appear, and thus, should be highly relevant toyour business. Selecting the right keywords for your particular businessand is essential to reaching interested prospects.
  15. 15. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure22. Landing Page23. LeadA landing page or microsite is the specific page or destination URL onwhich a person arrives after clicking on your PPC ads. Because your adcopy may include particular information regarding an offer, discountor other promotion, it’s generally bad practice to send your PPC adsto your website’s homepage. Highly-targeted landing pages increaseconversions and add to the effectiveness of your campaign.A lead is equivalent to a conversion. Depending on your particular goals,a lead may be a website visitor who submits a form, requests a quote,downloads a report or sends you an email. A well-built PPC campaignshould increase the number of leads your website receives.
  16. 16. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure24. Long Tail Keywords25. Match TypesLong tail keywords are keyword phrases consisting of at least 2 searchterms. They are more specific and tend to be less competitive, givingadvertisers a better opportunity to generate clicks from these keywords.For example, “women’s running shoe” is a long tail keyword. It’scounterpart, a short tail keyword, would be “shoe.” Since the long tailkeyword is much more targeted, you have better chances of gettinglicks and conversions from your ads than from using short tail keywords.Match types allow you to control when your ads are shown for specificsearch queries. Google offers three types of matching: broad, exact andphrase. Understanding how to use these match types is beneficial tomaximizing your advertising budget.
  17. 17. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure26. Negative Keywords27. Phrase MatchNegative keywords are specific keywords used to prevent your ad fromshowing for irrelevant searches. Adding negative keywords to yourcampaign allows you to qualify your clicks better and save you money.For example, if you were a seller of refurbished appliances, you maywant to exclude your ads from showing up for searches such as“new dishwasher.”Phrase matching is a type of matching that helps you control when yourads are shown. More specifically, phrase matching allows you to preventyour ads from being shown when people add additional words to yourtarget search query. For example, if your phrase match keyword was “cartires,” your ads would show for searches such as “cheap car tires” and“car tires for trucks.” However, your ads would not show for queries suchas “car snow tires.”
  18. 18. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure28. Position/Rank29. Quality Score (QS)The position or rank of your ads is the actual placement of your adsin the sponsored search results area. The higher your rank, the morevisibility your ad will get. Your ad positioning depends on a variety offactors including your budget and quality score.Your campaign’s quality score is a ranking method used by Google toassign ad placement as well as bid price. The higher your quality score,the better your ad will perform and the cheaper it will be to run yourads. Your quality score is based on a variety of factors including CTR andlanding page quality.
  19. 19. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure30. Reach31. RelevancyThe reach of your particular campaign is the estimated number ofpeople who will see your ads. It indicates the overall online exposurethat your ad will receive. The wider your reach, the more opportunitiesyou will have to attract new clients.Relevancy, an important part of your quality score, is essentially howrelevant your landing page or destination URL is in comparison to yourads. The more relevant and aligned your ads and landing pages are, thebetter your quality score and the less money you’ll end up paying foryour ads to show.
  20. 20. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure32. Return on Advertising Spend (ROAS)33. Return on Investment (ROI)Your ROAS is the amount of money you either gain or lose from yourinvestment in paid advertising. The goal, of course, is to gain morefrom advertising then the actual cost to advertise. The ROAS will varydepending on each business and industry.Similar ROAS, your ROI is essentially the ratio of money gained or lost onany investment, paid search advertising or other, relative to the amountinvested or spent on the particular investment.
  21. 21. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure34. Search Engine Results Page (SERP)35. Search QuerySearch engine results page are the actual results that a user sees afterentering a search query into a search engine. It contains both paid ads(PPC ads) and organic listings. The higher your visibility on SERPs, thebetter your online visibility.A search query or search term is a keyword or phrase used to run asearch on any search engine. These are the terms a person enters into asearch engine when looking for information, products or services.
  22. 22. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosure36. Short Tail KeywordsShort tail keywords, otherwise known as broad keywords, are short,usually one word, keywords. Given how broad they are, they tend to bemore competitive, costly and offer fewer chances for receiving clicks. Anexample of a short tail keyword is “shoe.” Given that the keyword is sobroad, and many other websites and advertisers exist who are usingthis keyword, short tail keywords are more competitive and will yieldfewer clicks.
  23. 23. call: 1.888.909.7265 | click: clickxposure.comCopyright©2013,ClickXPosureUnderstanding the basic terminology of PPC is crucialto making educated decisions about your onlinemarketing. From being able to understand performancestatistics to the structure of your campaign, learningthe lingo can go a long way.