Found Blog

search engine marketing terminology

Search Engine Marketing Terms, Part 1: PPC

Posted on in the categories

Working in the world of Pay per Click (PPC) it can be easy to forget that some of the PPC terms we use every day may not be clear to everyone around us. For starters, PPC is a form of search engine marketing where advertisers pay a publisher for each click on their ads. These ads can appear both on websites or on search engine results pages.

Whether you are just starting out in paid search yourself, working alongside PPC experts or just interested in what it’s all about, here is a list of paid search terms in the first part of our  terminology guide:

The top need-to-know PPC terms:

Search term / Search Query

The word or phrase searched for in a search engine.

Keyword

The word or phrase chosen by an advertiser that is used to determine whether an ad will show for a particular search term.

Match Type

A property of the keyword that determines which search terms a keyword is eligible to show for. There are several match types:

  • Exact – search term must match the keyword exactly
  • Phrase – search term contains keyword in that precise order
  • Broad – search terms contains keyword, misspells, similar terms and synonyms in any order
  • Modified broad – search terms contains keyword, misspells, similar terms but not synonyms in any order

You can also specify negative keywords which prevent an ad from showing if the search term contains that word or phrase.

Impressions

The number of times an ad is shown.

Click Through Rate (CTR)

The number of clicks your ad receives divided by the number of impressions. A high CTR is a good sign that your ad is relevant and stands out from competitors and it can lead to increases in quality score, lower CPCs and higher average positions.

However, a lower CTR is not always necessarily a bad thing, for example, including a price in your ad might reduce the number of people clicking on it but those that do might be more likely to convert. Additionally, ads in higher positions often see the highest CTR and search partners and the display network usually see lower CTRs than search.

Cost-per-click (CPC)

Actual CPC is the amount you pay for each click on your ad. Your actual CPC will not be higher than the Max CPC you assign a particular keyword but it is often lower depending on your quality score and the ad rank of competitors.

Quality Score

Google assigns keywords a Quality Score which is represented through the interface by a number from 1 to 10 (10 being highest) based on their relevance. This takes into account factors such as CTR, landing page quality and relevance, and relevance of the keyword to the search term and ad. A high quality score can lead to higher positions and lower CPCs.

Ad Rank

A measure that takes into account your Quality Score and bid to determine the position on the page your ad will show.

Conversion Rate (CR)

The number of conversions (sales, leads etc) divided by number of clicks.

Cost Per Acquisition (CPA) / Cost Per Lead (CPL) / Cost Per Sale (CPS)

The amount spent for each conversion.

Return on Investment (ROI)

A measure of how much money is made compared to how much is spent. One of the benefits of paid search is that you can track each sale or lead right down to individual keyword level so you can measure ROI at a very granular level and optimise accordingly to improve ROI.

Impression Share

The number of times your ad is actually shown divided by the number of times it entered the auction to be shown. If this is less than 100% your ads will be missing out on potential traffic. An ad might lose out on impression share because there is not enough budget or because ad rank is too low.

Ad Extensions

Additional information you can add to you ad. The most popular type of ad extension is sitelinks which allow you to add links to additional pages on your site underneath your main ad. There are many other ad extensions though such as call extensions, location extensions and social extensions.

Product Listing Ads (PLAs)

Ads that show on Google Search and Google Shopping that contain an image of a product, its price and the store name. These are set up within AdWords using a product feed in the Google Merchant Centre.

Remarketing

Remarketing lets you display ads to users who you know have previously visited your site.

Ad Scheduling / Day Parting

Allows you to adjust bids by a percentage at campaign level depending on time of day or day of week.

Discussion 2 comments

  • Jamie Brady

    And this can become even more confusing dependent on context of course – CPA or ‘cost per aquisition’ for a PPC advertiser relates to the amount of PPC spend required to get a sale. However more often than not we sell in the ‘CPA model’ to clients, which is either a fixed % of basket value or fixed fee. That’s the client’s effective cost per aquisition, but this is more static. Confusing!

    It’s interesting though, I use so many acronymns in daily life, I forget that people don’t always know what the hell I’m talking about!

    July 18, 2013 at 4:02 pm
  • Pingback: Search Engine Marketing Terms, Part 2: SEO | Found

  • Leave a Reply

    Your email address will not be published. Required fields are marked *

    You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>