PPC Definitions

Pay-Per-Click marketing has become an online phenomenon, withmarketers only paying for traffic they receive. As Internetmarketing has evolved, pay-per-click is seen by many as themiddle ground between paying per impression and paying per sale.Advertisers only pay when they receive traffic that may or maynot be targeted.

The pay-per-click advertisements are usually displayed with theadvertisement from the highest paying bidder in the topposition.

Navigating the complex web of Internet marketing, publishers andmarketers are often confronted with terms that seem foreign.This simple guide will assist marketers in navigating thePay-Per-Click marketing model.

Bid - The amount that an advertiser is willing to pay for aclick on a specific keyword.

Budget - The amount of money that an advertiser sets aside foran advertising campaign. Different publishers allow foradvertisers to set daily, weekly or monthly budgets.

Clickthrough Rate (CTR) - The percentage of clicks on a link.This is usually a percentage based on the total number of clicksdivided by the number of impressions that an advertisement hasreceived.

Conversion Rate - The relationship between visitors to a website and actions considered to be a "conversion", such as a saleor request to receive more information: the percentage of peoplewhose clicks have resulted in a sale or desired action inrelation to the total number of clicks on an advertisement.

Cost Per Click (CPC) - The cost or cost-equivalent paid perclick-through to an advertiser's website.

Cost Per Thousand (CPM) - The amount an advertiser pays for onethousand advertisement impressions, regardless of the consumer'ssubsequent actions.

Delisting - The removal of a listing as a result of inaction orpoor performance.

GeoTargetting - An advertisement targeted at a specificgeographical region, area or location.

Impressions - The number of times an advertisement is viewed byweb surfers.

Keywords - Search terms or phrases that are related to anadvertisement or ad copy.

Landing Page - The specific web page that a visitor ultimatelyreaches after clicking an advertisement. Often, this page isoptimized for a specific keyword term or phrase.

Linking Text - The text that is contained within a link.

Pay Per Click (PPC) - Advertising model in which advertisers payfor click-throughs to their website. Ads are served based onkeywords or themes.

Rank - How well a particular web page or web site is listed in asearch engine or advertising results.

Return On Investment (ROI) - The percentage of profit thatresults in a marketing or advertising campaign. Naturally,advertisers want the amount of money made to exceed the moneyspent.

Understanding the above terminology will help marketers navigatethe pay-per-click advertising model, which has emerged on theInternet and become one of the leading advertising models in theonline world.