Online advertising terms constantly evolve with technology. Basic terms include cost per click (CPC), cost per mile (CPM), cost per action (CPA), unique user, impression, banner ad, traffic, and reach. Rotation and exclusivity are terms that deal with how ads are displayed.
Online advertising is a field that is constantly evolving to keep up with technological advances; therefore, new terms and keywords are created almost daily. Some of these online advertising terms are more important than others, and there are some basic terms that any online advertiser should be absolutely familiar with. The most important online advertising terms deal with how ads are paid for, such as cost per click (CPC), cost per mile (CPM) and cost per action (CPA). Other terms deal with how advertisements are laid out on the Internet, such as the phrase “above the fold,” which refers to the area of a website that can be viewed without vertical scrolling. Another very important online advertising term is reach as it deals with the actual number of people who are likely to be exposed to an ad.
There are several basic industry-related terms that are needed to understand anything else. One such basic term is “unique user”, which refers to a computer that has been identified by an IP address, cookie or other means, so that repeat visits by the same person are not counted multiple times. Whenever a unique user visits a website and sees an ad, this is often referred to as an impression. When an image ad is used and the link to an external website, this is often referred to as a banner ad.
Many of the most important online advertising terms deal with how advertisements are paid for. In most cases, the cheapest type of online advertising is CPM. This type of advertising involves paying a fee based on the number of unique users who view a banner, similar to most types of offline advertising. The term CPC refers to a type of advertising where payments are made based on how many times an ad is clicked and CPA usually requires unique users to fill out a form that provides the advertiser with a lead.
Other important online advertising terms deal with how many people are likely to see an ad. Traffic is one of the most important terms to understand in this context, as it indicates how many unique users visit a website in a given period of time. Reach is a traffic-based term, as it refers to how many people are likely to see an ad. If an ad is likely to have a lot of reach, it will be seen by many people and can be quite expensive.
Two online advertising terms that deal with how ads are displayed are rotation and exclusivity. Banner rotation is a term that indicates that an advertising banner will be exchanged for other banners so that each unique user of a website will have a slightly different advertising experience. Uniqueness means that a site will only run banners from one advertiser, although this is usually more expensive. A related term is threading, which is a technique websites can use to ensure that each unique user is presented with a unified advertising experience based on their own activity while browsing the website.
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