Do you ever feel adrift in a ‘C’ of acronyms? PPC, CPC, CPM . . . Some are more well-known, like PPC and SEO, but authors and speakers frequently throw many of these terms out with no explanation of the cryptic letters. I’ve gathered and defined the most common Internet marketing and search acronyms that I’ve come across, and offer them here as a mini-glossary. If you stumble across other acronyms, let me know and I’ll add them to the list.
CPM - Cost Per Thousand Impressions
Literally, “cost per mille,” which in Latin means thousand. Sometimes, CPI and CPM are used interchangeably, as when an ad campaign is sold on the basis of 1000 impressions. One thousand impressions at a $10 CPI results in a $10,000 CPM ad campaign.
eCPM - Effective Cost Per Mille
Measures what a publisher would receive if their advertising inventory was sold on a CPM basis as opposed to a CPA, CPC, or CPT basis (see below for these definitions).
CPI - Cost Per Impression
This is the cost paid each time an online advertisement, such as a banner ad, is displayed.
CPT - Cost Per Transaction
Similar to CPA, in that advertisers pay whenever a visitor who clicked on their advertisement completes a transaction.
CPA - Cost Per Action, or Cost Per Acquisition
In the PPA advertising model, the CPA is the actual cost paid when the action is completed.
CTR - Click Through Ratio
A ratio of the number of times an ad was clicked on by the viewer and the number of times the ad was displayed. For a banner that was clicked 100 times and displayed 1000 times, the CTR is 100:1000 or 1:10. This can be changed to a percentage value by multiplying by 100: 1/10 * 100 = 10%, meaning 10% of the impressions have led to clicks on the banner.
CPC - Cost Per Click
The amount an advertiser pays each time an ad is clicked. Sometimes this is set through a bidding process, other times the cost is determined by calculating the CPI/%CTR
PPC - Pay Per Click
An advertising model where advertisers pay only when a user clicks on an ad to visit the advertiser’s website.
PPA - Pay Per Action
Advertisers pay only when pre-specified actions are completed by a user on their site, such as when a user makes a purchase, signs up for a newsletter, fills out a form, or downloads a free trial.
CPS - Cost Per Sale
The cost an advertiser pays only for those click-throughs on an ad that result in a purchase.
EPC - Earnings Per Click
The commission you pay to a publisher or affiliate advertiser for each click (visitor) they send to you. If you pay $20 after receiving 100 visitors, $20/100 = 0.20 and the EPC is 20 cents per click.
CPL - Cost Per Lead
A payment arrangement where an advertiser pays a publisher for a lead, which is a verified potential customer. For example, the publisher may run an ad for a free trial. A user that clicks on the free trial link is a lead that may become a future customer, and the publisher is paid a certain CPL.
SEO - Search Engine Optimization
The act of enhancing a site’s ability to be crawled frequently and effectively by search engines.
SEM - Search Engine Marketing
Internet marketing that seeks to increase a site’s visibility in the search engines through ad campaigns and SEO.
SERPs - Search Engine Results Pages
The listing of web pages returned when a search is performed.
MLM - Multi-level Marketing
Often indistinguishable from “pyramid schemes” in which commissions are paid to each seller based on the number of additional sellers that they can recruit.
B to B or B2B - Business to Business
Internet-based business-to-business commerce typically engaged in by manufacturers, wholesalers and suppliers who market to other businesses.
B to C or B2C - Business to Consumer or Business to Customer
Retailers who typically market to an individual consumer rather than a business.
CPGs - Consumer Packaged Goods
Any consumable goods that are ready for purchase by a consumer.
P to P or P2P - Peer To Peer
Not really a marketing acronym but it is fairly common; P2P refers to file sharing over the Internet or on small networks.
MFA - Made For AdSense
Refers to an advertisement that is developed specifically for AdSense.
ROAS - Return On Advertising Spending
Dollars earned versus dollars spent on an advertising campaign.
Posted on October 12th, 2007 by Vanessa
Filed under: Marketing and Promotion
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