Glossary of PPC Terms

Do you need more leads in your sales funnel? Do you want a position on page 1 of the search results right now?

Pay-per-click (PPC) ads are hands-down the fastest way to generate highly qualified traffic to your website. You’ve probably seen them at the top of Google search results pages or in your Facebook newsfeed or in banner ads on websites you visit. Yes, you’ll pay for each click (hence the name), but if your PPC campaigns are designed correctly, you will get higher than normal conversion rates because you’ll only be serving ads to searchers that are in your target audience and are in the market for your services.

PPC can also be a risky online marketing strategy. Because you pay for every click, you can burn a lot of money fast if you don’t make the right choices with targeting, ad copy, landing pages, and bidding strategies. That’s where we come in. We specialize in taking what we’ve learned about the services you provide, your unique selling proposition, your target users and the value they are seeking and turn that into high performing ad campaigns that have a positive return on investment.

Business Owners, organizational leaders, and marketers are often confused by the terms and jargon that PPC professionals utilize. Here is a selection of many of the common PPC terms and their definitions.

PPC Terms:

• Ad Position – the position an advertiser’s PPC ad receives on a search engine’s SERP, as determined by the search engine’s auction bidding process and the resulting Ad Rank.
• Ad Rank – a real-time numeric value assigned by a search engine’s PPC auction bidding process, to each participating advertiser’s ad. The ad rank determines which ad position each ad will receive on the SERP, relative to their competitors in the same auction.
• Advertisement (Ad) – a presentation of text, sometimes combined with images or video, in an online public space, promoting a product, service, event, etc.
• Auction Bid – PPC advertisers must “bid” to show an ad on a search engine for a specific keyword. In actuality, the search engine considers all bids in real-time, from all advertisers bidding on a specific keyword, and the highest bid wins the auction, followed by the 2^nd highest bidder, etc.
• Available Impressions – the number of ad impressions available, in a given time period, for the keywords an advertiser is bidding to show PPC ads to searchers typing matching search queries in a search engine.
• Average Position – the average ad position an advertiser’s PPC ad, or group of ads, receives on a search engine’s SERP for a specified period of time.
• Bounce – a noun used to describe the action an online searcher takes when, after visiting an advertiser’s website, they hit the back button (i.e. leave the website) without visiting any other page(s) on the website or taking further action. This action is considered by search engines to indicate that the searcher did not find relevant (to them) content on the website page they visited.
• Bounce Rate – a website performance metric, calculated by dividing the number of “bounces” by the number of website visits in a given time period. Over time, this provides an indication of how relevant the advertiser’s content is to online searchers.
• Click-Through-Rate (CTR) – a PPC performance metric calculated by dividing the number of clicks a PPC ad receives by the number of impressions the ad received.
• Click(s) – a noun used to describe the action an online searcher takes when they execute a mouse click on a PPC ad. A click results in a website visit, or may also result in a direct phone call on a mobile device.
• Conversion-Rate (CVR) – a PPC performance metric calculated by dividing the number of conversions a PPC ad (or group of ads) receives by the number of clicks the ad received.
• Conversion(s) – the term used to describe when a searcher takes an action that an advertiser deems to be indicative of a potential sales lead or an actual sale. Typically includes actions such as filling out an online form, requesting a quote, purchasing a product or service online, calling the advertiser’s business, downloading content (ex. an e-book), etc.
• Cost – the actual amount of money spent with a search engine to place ads on their platform, over a specified period of time.
• Cost-Per-Acquisition (CPA) – a PPC performance metric calculated by dividing the cost spent with a search engine to display PPC ads on their platform, divided receives by the number of conversions the ads generated.
• Cost-Per-Click (CPC) – the price an advertiser pays to a search engine for showing a PPC ad for a specific keyword, or group of keywords, in a given time period.
• Cost-Per-Lead (CPL) – the same PPC metric calculation as Cost-Per-Acquisition, where the denominator represents only conversions actions resulting in leads rather than sales.
• Daily Budget – a daily amount of money that an advertiser is willing to spend with a search engine to place ads on their platform.
• Impression – one “showing” of a PPC ad for a relevant search query typed into a search engine.
• Impression Share – a PPC metric calculated by dividing impressions by available impressions for a specified period of time. The resulting percentage indicates how much of the available search market share the advertiser received.
• Impression Share Lost to Budget – a PPC metric calculated by dividing impressions lost due to lack of budget, by available impressions for a specified period of time.
• Impression Share Lost to Rank – a PPC metric calculated by dividing impressions lost due to low ad rank as compared to their competitors, by available impressions for a specified period of time.
• Keyword – a word, or series of words, identified by an advertiser, for which they wish to display a search ad.
• Pay-Per-Click (PPC) – an online advertising model where advertisers may show ads to relevant online searchers. Advertisers only pay for showing an ad when a searcher actually clicks on an ad.
• Quality Score – a score assigned to keywords by a search engine’s evaluation process over time. Usually, a combination of factors is considered, including relevancy (of the keyword, ad copy, and website landing page content), website load speed, click-through-rate, keyword bid, etc. Used by search engines to help determine ad position on the SERP, and the actual Cost-Per-Click the advertiser will pay in an auction.
• Relevant – in order for an advertiser to show a PPC ad to an online searcher, the search engine must deem that a searcher’s search query matches a relevant keyword that the advertiser is bidding to show.
• Search Engine Marketing (SEM) – a method of online marketing that promotes websites through the use of paid advertisements (ads).
• Search Engine Optimization (SEO) – a process of increasing organic search traffic by increasing the ranking of website pages.
• Search Engine Results Page (SERP) – a listing of advertisements, sponsored listings and website links on a search engine, ordered by the search engine’s ranking methodology.
• Search Query – a word, or series of words, typed into a search engine by a user searching for information online.
• Spend – the actual amount of money spent with a search engine to place ads on their platform, over a specified period of time. (This may be the preferred term used by some search engines.).

Want to learn more about PPC? Visit our PPC services page.

Improve & Grow is an Online Marketing Agency serving clients across the United States and beyond. If you are interested in talking with us about PPC campaign management, SEO, Website Development or Strategy and Analytics services, please click the Get Started button above to contact us, or schedule an appointment now.