Online marketing terminology explained

Here is a short list of terms used in online advertising and marketing.


CPM or cost per mille shows how much money are you making for every thousand ad impressions. In order to calculate your CPM rate you will need to use this simple formula:

CPM rate = (earnings/impressions) x 1000

If you’re a marketeer, just replace earnings with your cost. For example, if you earned $5.73 from 4300 impressions:

CPM rate = ($5.73/4300) x 1000 = $1.33

In this example you earned $1.33 for each thousand ad impressions.


Cost per action or sometimes also called cost per acquisition, indicates that advertisers only pay when a visitors performs some action, such as site registration, completes a survey or installs a software (in this case model is called cost per lead or CPL) or purchases a product or site subscription (CPS or cost per sale).


Pay per click indicates that advertisers pay for clicks on their ads. Advertisers usually bid for ad space using some PPC platform such as Google AdWords or Microsoft AdCenter. These platforms have algorithms that adjust click prices based on various factors, such as performance, niche, CTR etc. On the advertiser’s side, it is called CPC or cost per click.


Or search engine marketing is a set of techniques used to improve website ranking and visibility in search engines. It is usually achieved by optimizing various page elements and content or through advertising directly on search engine results pages (SERPs).


Search engine results page is what user gets after performing a search on search engines. Is a list of websites determined by search algorithm as a best match to user’s query. Advertising on SERPs is especially popular among internet advertisers as a way to get very targeted visitors.

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