Navigating the world of digital advertising and marketing can be challenging with its specialized terminology and fast-evolving practices. This comprehensive glossary aims to clarify key terms and concepts, providing clear and concise definitions to help marketers, advertisers, and anyone interested in digital marketing better understand the industry's jargon.
A
Active ID: A unique digital identifier associated with an individual device for tracking, targeting, and optimizing ad delivery and performance.
Above The Fold (ATF): Refers to any content shown when a page loads. This limited space is reserved for premium content and messaging to drive the user further down the page.
Ad Exchange: A digital marketplace allowing advertisers to buy and sell ad inventory on the open internet. Publishers offer their ad space, and advertisers and ad networks can bid on the inventory in real-time auctions.
Ad Format: The size of an ad (width by height), usually measured in pixels.
Attribution: Determines how much credit is given to each touchpoint that leads a prospect to a conversion. Attribution identifies the steps a user takes through the buyer's journey and determines the value of each step.
Auction: An online marketplace allowing real-time bids on various publishers' digital ad inventory.
B
Behavioral Targeting: Uses browsing history and other user data to determine which advertisements would be most relevant to place in front of a user on a given website.
Bid: Offer placed by an advertiser in a digital auction to claim an impression.
Budget: The amount an advertiser will spend in a period.
C
Conversion Rate: A measurement of how many users take a desired action, such as making a purchase, clicking through an ad, or filling out a form. It is a measurement of the success or failure of a marketing campaign.
Customer Acquisition Cost (CAC): The cost associated with acquiring a new customer, including all marketing and sales expenses. It includes all resources required to convince a customer to buy the service.
Customer Lifetime Value (CLTV/LTV): The predicted net profit attributed to the entire future relationship with a customer.
Contribution Margin After Marketing (CMAM): The amount of revenue left over after covering direct costs and all marketing expenses.
Cost-Per Action (CPA): The average cost of a previously defined user action. (e.g., time spent on a website, interaction with a specific link, a conversion.)
Cost-Per Mille (CPM): The cost a marketer will pay for every one thousand impressions of a digital ad.
Click-through Rate (CTR): The percentage of clicks advertisers receive on their ads or links per number of impressions.
Contextual Advertising: Placing advertisements on web pages that closely relate to the on-page content. (e.g., Inserting an ad for luggage on a travel site or blog.)
D
Data Management Platform (DMP): A technology platform used for collecting and managing data, primarily for digital marketing purposes.
E
Excess Potential: The leftover budget that ad groups have access to spend if no targeting settings are changed.
F
First-party Data: Data that a company gathers directly from its users. This data is gathered through user interactions with the company's website, social channels, and other direct engagement points. Data can include demographics, purchase history, and preferences and is voluntarily shared by users.
Flight: The total duration of an ad campaign from start to finish.
Forecasting: Using historical data to estimate the potential spend, impressions, reach, and frequency for a campaign or specific ad group.
Frequency: Metric measuring the rate at which ads are served to the same target audience. Balancing frequency with messaging and reach allows for increased brand recall and recognition.
G
Geofencing: Serves relevant ads based on the user's current location and proximity to stores, restaurants, and other services. Fences can be drawn around precise locations to observe trends and identify target audiences.
H
Household: Groups of individuals who share a common physical address or reside together.
I
Impression: A single instance of an advertisement on a web page or app. When a user views a web page or interacts with an app where an ad is displayed, it counts as one impression. Impressions indicate that the ad was loaded and appeared on the user's screen.
J
K
Key Performance Indicator (KPI): An important metric used to measure the success of an organization, team, or campaign. KPIs are chosen and prioritized based on their overall performance impact. (e.g., Revenue Growth Rate, Conversion Rate, Customer Lifetime Value, and ROI.)
L
M
Marketing Efficiency Ratio (MER): A measure of marketing effectiveness, typically calculated as the ratio of customer lifetime value (CLTV) to customer acquisition cost (CAC).
Multichannel: Uses more than one channel to execute campaigns. This is done manually on a channel-by-channel basis. Content has little differentiation or personalization and is published on every channel with rudimental segmentation. This results in quantity over quality.
N
O
Omnichannel: A customer-centric, data-driven approach to advertising focused on customer behavior, preferred channels, and lifecycle stage. With this data, resonant messaging can be sent to the right channel at the right time. All channels are integrated so the customer has a unified and consistent experience across platforms.
P
Pacing: The distribution and timing of ad impressions or budget spend over a specified period, ensuring that campaign goals are met smoothly and efficiently without exhausting resources too quickly or too slowly. (e.g., The campaign is now pacing to 100%.)
Programmatic Advertising: Automated buying and selling of digital advertising space allowing for real-time bidding on online inventory and dynamic ad insertion across the open internet. Allows for precision targeting of segmented audiences.
Q
R
Real-Time Bidding (RTB): An automated process of buying and selling ad inventory through real-time auctions. Ad buyers bid on an impression in real time, and if the bid wins, it is immediately shown on the website. The entire process occurs before a website’s loading.
Return On Ad Spend (ROAS): A metric that measures the revenue generated for every dollar spent on advertising. Calculating and keeping track of ROAS gives insights into the effectiveness of an ad campaign.
Revenue Growth Rate (RGR): The rate at which a company's revenue grows over a specific time.
S
Supply Side Platform (SSP): An AdTech software platform that allows digital publishers to sell ad space in automated auctions. Publishers use SSPs to manage and optimize their display, video, and native ads. SSP advertising helps publishers monetize their websites.
T
U
Urchin Tracking Module (UTM): A code attached to a URL to track and analyze the effectiveness of digital marketing campaigns. UTMs allow marketers to monitor and measure various campaign metrics, such as clicks, conversions, and traffic sources. UTM parameters typically include values for parameters such as source, medium, campaign, term, and content, which identify the source of traffic.
V
W
Walled Garden: A closed ecosystem of company data, hardware, software, and services. Google and similar companies make sure their data is inaccessible from the rest of the open internet, resulting in monopolies of digital user information.
X
Y