November 27, 2010

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Terms Used in Online Advertising

If you are into display advertising, or even just advertising on a portal, you are likely to be confronted with a number of terms used to cover aspects of Internet advertising. It’s good to know a little bit more about what they actually mean, so we’ve put together the following list:

Ad: An online ad is almost always a banner, a graphic image, or set of animated images with a designated pixel size and byte size limit. Banners and other special advertising that include an interactive or visual element beyond the usual are known as “rich media”.

Ad rotation: Ads are often rotated into ad spaces from a list. This is usually done automatically by software on the website or at a central site administered by a server facility for a network of websites.

Ad space: An ad space is a space on a web page that is reserved for ads. An ad space group is a group of spaces within a website that share the same characteristics so that an ad purchase can be made for the group of spaces.

Ad view/Ad impression: An ad view, synonymous with ad impression, is a single ad that appears on a web page when the page arrives at the viewer’s display. Ad views are what most websites sell. A web page may offer space for a number of ad views. The term impression is more commonly used.

Banner: A banner is an advertisement in the form of a graphic image that typically runs across a web page or is positioned in a margin or other space reserved for ads. Banner ads are usually Graphics Interchange Format (GIF) images. In addition to adhering to size, many websites limit the size of the file to a certain number of bytes so that the file will display quickly.

Click: According to ad industry recommended guidelines from FAST, a click is “when a visitor interacts with an advertisement”. This does not mean simply interacting with a rich media ad, but actually clicking on it so that the visitor is headed toward the advertiser’s destination. (It also does not mean that the visitor actually waits to fully arrive at the destination, just that the visitor started going there.)

Click stream: A click stream is a recorded path of the pages a user requested in going through one or more websites. Click stream information can help website owners understand how visitors are using their website and which pages are getting the most use. It can help advertisers understand how users get to the client’s pages, what pages they look at, and how they go about ordering a product.

Clickthrough: A clickthrough is what is counted by the sponsoring website as a result of an ad click. In practice, click and clickthrough tend to be used interchangeably. A clickthrough, however, seems to imply that the user actually received the page. A few advertisers are willing to pay only for clickthroughs rather than for ad impressions.

CTR - Click rate: The click rate is the percentage of ad views that resulted in clickthroughs. Although there is visibility and branding value in ad views that don’t result in a clickthrough, this value is difficult to measure. A clickthrough has several values: it’s an indication of the ad’s effectiveness and it results in the viewer getting to the advertiser’s website where other messages can be provided.

Cookie: A cookie is a file on a web user’s hard drive that is used by websites to record data about the user. Some ad rotation software uses cookies to see which ad the user has just seen so that a different ad will be rotated into the next page view.

CPA - Cost-per-action: Cost-per-action is what an advertiser pays for each visitor that takes some specifically defined action in response to an ad beyond simply clicking on it. For example, a visitor might visit an advertiser’s site and request to subscribe to their newsletter.

CPC – Cost-per-click: Cost-per-click is basically the amount payable on a clickthrough from an ad to the advertiser’s website.

CPL - Cost-per-lead: This is a more specific form of cost-per-action in which a visitor provides enough information at the advertiser’s site (or in interaction with a rich media ad) to be used as a sales lead. Note that you can estimate cost-per-lead regardless of how you pay for the ad (in other words, buying on a pay-per-lead basis is not required to calculate the cost-per-lead).

CPS – Cost-per-sale: Websites that sell products directly or can otherwise determine sales generated as the result of an advertising sales lead can calculate the cost-per-sale of web advertising.

CPM: CPM is “cost-per-thousand” ad impressions, an industry standard measure for selling ads on websites. This measure is taken from print advertising. The “M” has nothing to do with “mega” or million. It’s taken from the Roman numeral for “thousand.”

CPTM: CPTM is “cost-per-thousand targeted” ad impressions, apparently implying that the audience you’re selling is targeted to particular demographics.

Filtering: Filtering is the immediate analysis by a program of a user web page request in order to determine which ad or ads to return in the requested page. A web page request can tell a website or its ad server whether it fits a certain characteristic such as coming from a particular company’s address or that the user is using a particular level of browser.

Fold: “Above the fold,” a term borrowed from print media, refers to an ad that is viewable as soon as the web page arrives. You don’t have to scroll down (or sideways) to see it. Since screen resolution can affect what is immediately viewable, it’s good to know whether the website’s audience tends to set their resolution at 640 by 480 pixels or at 800 by 600 (or higher).

Hit: A hit is the sending of a single file, whether an HTML file, an image, an audio file, or other file type. Since a single web page request can bring with it a number of individual files, the number of hits from a site is a not a good indication of number of visits or visitors. It is not a good indicator for advertisers.

Impression: An impression is “the count of a delivered basic advertising unit from an ad distribution point”. Impressions are how most web advertising is sold and the cost is quoted in terms of the cost-per-thousand impressions (CPM).

Inventory: Inventory is the total number of ad views or impressions a website has to sell over a given period of time (usually, inventory is figured by the month).

Opt-in email: Opt-in email is email containing information or advertising that users explicitly request (opt) to receive. Typically, a website invites its visitors to fill out forms identifying subject or product categories that interest them and about which they are willing to receive email from anyone who might send it. It is basically providing permission for a user to receive email marketing from companies.

Pay-per-click: In pay-per-click advertising, the advertiser pays a certain amount for each clickthrough to the advertiser’s website. The amount paid per clickthrough is arranged at the time of the insertion order and varies considerably. Higher pay-per-click rates recognise that there may be some “no-click” branding value as well as clickthrough value provided.

Pay-per-lead: In pay-per-lead advertising, the advertiser pays for each sales lead generated. For example, an advertiser might pay for every visitor that clicked on a website and then filled out a form.

Pay-per-sale: Pay-per-sale is not customarily used for ad buys. It is, however, the customary way to pay websites that participate in affiliate programs, such as those of and

Pay-per-view: Since this is the prevalent type of ad buying arrangement at larger websites, this term tends to be used only when comparing this most prevalent method with pay-per-click and other methods.

Rich media: Rich media is advertising that contains perceptual or interactive elements more elaborate than the usual banner ad. Today, the term is often used for banner ads with popup menus that let the visitor select a particular page to link to on the advertiser’s website. Rich media ads are generally more challenging to create and to serve. Some early studies have shown that rich media ads tend to be more effective than ordinary animated banner ads.

ROI: ROI (return on investment) is “the bottom line” on how successful an ad or campaign was in terms of what the returns (generally sales revenue) were for the money expended (invested).

RON - Run-of-network: A run-of-network ad is one that is placed to run on all websites within a given network. Ad sales firms handle run-of-network insertion orders in such a way as to optimise results for the buyer consistent with higher priority ad commitments.

ROS - Run-of-site: A run-of-site ad is one that is placed to rotate on all non-featured ad spaces on a website. CPM rates for run-of-site ads are usually less than for rates for specially-placed ads or sponsorships.

Splash page: A splash page (also known as an interstitial) is a preliminary page that precedes the regular home page of a website and usually promotes a particular website feature or provides advertising. A splash page is timed to move on to the home page after a short period of time.

Targeting: Targeting is purchasing ad space on websites that match audience and campaign objective requirements., with over 20 websites targeted to special information technology audiences, is an example of an online publishing business built to enable advertising targeting.

Unique visitor: The term “unique visitors” should not to be confused with “visits”. Unique visitors refers to the number of individuals that have accessed the website. One unique visitor may visit the site many times (adding to the number of visits) but is still counted as one unique visitor.

User session: The session of activity that a user with a unique IP address spends on a website during a specified period of time. The number of user sessions on a website is used in measuring the amount of traffic it gets. The website administrator determines what the time frame of a user session will be (e.g., 30 minutes). If the visitor comes back to the website within that time period, it is still considered one user session because any number of visits within that 30 minutes will only count as one session. If the visitor returns to the website after the allotted time period has expired, say an hour from the initial visit, then it is counted as a separate user session.

View: A view is, depending on what’s meant, either an ad view or a page view. Usually an ad view is what’s meant. There can be multiple ad views per page view.

Visit: Visits are the number of times the website is accessed or “visited”. Visits are also known as user sessions. One unique visitor can have many visits to your website.


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  1. Effective Banner Advertising – Part 1
  2. Real Estate Advertising Tips from
  3. Selling Online Advertising to Vendors
  4. Century 21 to Increase Online Advertising
  5. Effective Banner Advertising – Part 2
  6. Display Advertising Options



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