Pay Per Click Glossary

As a merchant in today’s economy, competition is fierce and you need every dollar of your advertising budget to count. When you utilize a pay per click advertising campaign, you can maximize the exposure to your goods and services by being able to reach your target audience directly.

 

Although pay per click can be a great tool to use, it can also be very confusing. When you are searching for a way to implement a pay per click campaign, you will be bombarded with words and phrases you may not understand. Read on to find out what a few of the terms mean. This will ensure that you are prepared to choose the right campaign that will not only fit your budget, but also your marketing goal.

Auto Bidding:

This is a way that your bid on a particular keyword is changed automatically by a penny if your closest competitor changes their bid. Even though you have a maximum fixed bid, it is possible that you will pay less if the auto bidding works in your favor.

Backlink:

A backlink is a link that can be found on another website that takes the user to your website.

Cost Per Click (CPC):

This is the amount you will pay for each browser that clicks on your ad. There are those who use this term instead of pay per click.

Conversion Rate:

This is the rate of browsers who actually buy or convert the particular product or service you are selling. This is calculated as the number of clicks divided by the number of actual purchases (conversions). When the conversation rate is high, this is an indication that your campaign has been effective.

CPM:

This refers to the price for 1000 views of your ad.

Impression:

This term is also referred to as ad views.

Keyword:

The keywords are the most important component of a successful pay per click campaign. These are the words that the user will type into the search engine to search for items on the internet. Your goal is to use these relevant words in your campaign. Depending upon the size of the company and the ad campaign, keywords can range from a few words to thousands of unique words and phrases.

Keyword Bid:

This is the amount you are ready to pay each time a user utilizes your ad on a search engine and pays a visit to your website.

Link Building Campaign:

This term relates your business and another business that is very similar to yours in order for you to exchange links. This will allow you both to move up in natural search engine robot crawls and in a pay per click ad campaign.

Page Rank:

This is the place your website has on a search engine. This term is usually abbreviated as PR.

Reciprocal Linking:

This is a process where one website links to another because their products complement each other. The more links to other sites you have, the higher your site will normally rank in the various search engines.

 

There are many more terms you may need to know than just the ones listed here. Be sure to inform yourself as much as possible so you will feel confident about what you are getting into before you sign on the dotted line.