As with any branch of search engine marketing, Pay-Per-Click (PPC) advertising comes with its own set of jargon. To us industry folk, such terminology is standard, but it can sound like gibberish when spoken to the unenlightened. Let’s take a look at some popular search engine advertising terminology.

The Big Picture

When learning about search engine advertising, there are a couple of terms you absolutely have to know:

Pay-Per-Click (PPC): Pay-Per-Click is a model of search engine advertising that chargers advertisers by clicks, not impressions (the number of times an ad is displayed). PPC ads are displayed on search engine result pages, affiliate services, and external sites.

Search Engine Marketing (SEM): Search Engine Marketing describes any promotional technique related to search engines, with two main branches: Search Engine Optimization (SEO) and Pay-Per-Click (PPC). SEO affects organic search results, while PPC targets sponsored ad listings.

Other Terms

A/B Testing: A method of testing that compares two variables to see which is more effective. For example, you could devote half of your day’s budget to PPC ads promoting “Free Shipping on Canon Cameras!” and half on “Canon Cameras with Free Shipping!” A/B testing can be used on both ads and landing pages, and concerns not just wording but also capitalization, alignment, and design, among other variables.

Call to Action: When it comes to PPC management, bossy is good. A call to action is a statement imploring visitors to stop reading and start doing. This could include a variety of activities, including buying a product, submitting a quote request, or joining an email list.

Conversion Rate: The portion of PPC visitors who execute a certain action, such as completing a sale or requesting a quote. If your clicks aren’t leading to conversions, there could be a disconnect between your ad text and the landing page or website that users are visiting.

CPC (Cost Per Click): The agreed upon amount that advertisers pay PPC engines for every click their ads receive. Different keywords and keyphrases have different CPCs, as determined by industry competition and the Quality Score of each (see below).

CTR (Click Through Rate): The amount of clicks a PPC ad receives, divided by its total impressions.

Multivariate Testing: Also known as multi-variable testing, this method of ad comparison takes A/B testing to a whole new level, with the ability to examine multiple variables at a time to create the perfect combination of factors.

Quality Score: Google AdWords uses its Quality Score feature to make sure that sponsored advertisements remain relevant to user search results. A higher Quality Score can actually decrease your CPC and increase your ad’s ranking and exposure.

ROI (Return on Investment): This statistic calculates the cost-effectiveness of your PPC campaign by dividing the money gained (or lost) by the cost of advertising.

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