It seemed like online advertising was going the way of Wall Street with the emergence of the exchanges, DSPs and SSPs — turning into a sort of obscure acronym soup. With even more acronyms focused on data, segmentation, movement, attribution, and management it easy to get lost.
Don’t worry we will offer some clarity to this Online Advertising Alphabet Soup.
Ad Exchange: Ad exchanges are technology platforms that facilitate the bidded buying and selling of online media advertising inventory from multiple ad networks. The approach is technology-driven as opposed to the historical method of negotiating price on media inventory.
Ad Tag: A small piece of code that defines the ad space where ads display on a website. It includes parameters that describe the inventory advertising campaigns can target, which may in turn display ads in the ad space.
CPM: Cost per mille (CPM), also called cost and cost per thousand (CPT), is a commonly used measurement in online advertising. It is used in marketing as a benchmark to calculate the relative cost of an advertising campaign or an ad message in a given medium.
Category: A descriptive that refers to a subject covered by a website or creative, such as monster trucks or ecology.
Click through: The action of clicking an ad and being taken to another web page via a hyperlink.
Click-through URL: A destination website address that a viewer goes to when they click on an ad.
Conversion: The measure of the number of times that a tracker has been displayed that has been successfully linked to a previous creative impression or click.
CPI: Cost per impression (CPI) refers to the cost of internet marketing or email advertising campaigns where advertisers pay each time an ad is displayed. Specifically, it is the cost or expense incurred for marketing potential customers who view the advertisement(s).
CPO: Cost per order (CPO), also called cost per purchase, is the cost of internet advertising divided by the number of orders. Cost per order, along with cost per impression and cost per click, is the starting point for assessing the effectiveness of a company’s internet advertising.
CPA: Cost Per Action or CPA (sometimes known as Pay Per Action or PPA; also Cost Per Conversion) is an online advertising pricing model, where the advertiser pays for each specified action – this could include (but not limited too): an impression, click, form submit (e.g., contact request, newsletter sign up, registration, etc), double opt-in or sale.
PPC: Pay per click (PPC) (also called cost per click) is an internet advertising model used to direct traffic to websites, in which advertisers pay the publisher (typically a website owner) when the ad is clicked. It is defined simply as the amount spent to get an advertisement clicked.”
CPC: Cost Per Click (CPC) means advertisers pay each time a user clicks on the ad. CPC advertising works well when advertisers want visitors to their sites, but it’s a less accurate measurement for advertisers looking to build brand awareness. CPC’s market share has grown each year since its introduction, eclipsing CPM to dominate two-thirds of all online advertising compensation methods.
CTR: Click-through rate (CTR) is a way of measuring the success of an online advertising campaign for a particular website as well as the effectiveness of an email campaign by the number of users that clicked on a specific link.
DSP: A demand-side platform (DSP) is a system that allows buyers of digital advertising inventory to manage multiple ad exchange and data exchange accounts through one interface. Real-time bidding for displaying online ads takes place within the ad exchanges, and by utilizing a DSP, marketers can manage their bids for the banners and the pricing for the data that they are layering on to target their audiences.
DMP: A DMP is a centralized data management platform that allows you to create target audiences based on a combination of in-depth first-party and third-party audience data; accurately target campaigns to these audiences across third-party ad networks and exchanges; and measure with accuracy which campaigns performed the best across segments and channels to refine media buys and ad creative over time.
Frame ad (traditional banner): Frame ads were the first form of web banners. The colloquial usage of “banner ads” often refers to traditional frame ads. Website publishers incorporate frame ads by setting aside a particular space on the web page.
Frequency capping: Using cookies to track the impression count of ads served and stopped any given ad being shown to a single visitor more than the set number of times.
Impressions: An impression is the display of an ad to a user while viewing a web page. A single web page may contain multiple ads. In such cases, a single page view would result in one impression for each ad displayed.
Inventory: This term refers to the amount of ad space available on a website.
RTB: Real-time bidding (RTB) is a new method of selling and buying online display advertising in real time one ad impression at a time. Instead of bulking buying and inventory-centric buying, RTB mimics stock exchanges and utilizes computer algorithms to automatically buy and sell ads in real-time. Empirical analysis suggests that RTB encourages the use of per impression context and targets the ads to specific cookies, primarily based upon demographic and behavioral data, and hence dramatically increases the effectiveness of display advertising.
Programmatic advertising: The use of technology to automate processes and the use of math to improve results.
SSP: A supply-side platform or sell-side platform (SSP) is a technology platform with the single mission of enabling publishers to manage their advertising impression inventory and maximize revenue from digital media. As such, they offer an efficient, automated and secure way to tap into the different sources of advertising income that are available, and provide insight into the various revenue streams and audiences.