April 3, 2011

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Back to Basics: SEM Terms Explained

We’ve talked before about how search engine marketing, or SEM, can be a serious boost to your online marketing efforts. But when you first look at starting up your SEM campaign, you can easily get lost in all the new terminology that’s involved. If you’re finding it hard to make sense of all the acronyms, start with this guide:

PPC: This stands for pay-per-click, a model that simply means you pay a fee each time someone clicks on your advertisement.

CPA: Cost-per-action, sometimes known as pay-per-action or PPA. Through this model, you pay each time someone take a specific action, such as filling out an online form.

CTR: Click-through rate. The click-through rate is determined by dividing the number of times your ad was actually clicked on by the number of times it was seen. So if your ad is seen 100 times but only clicked on once, it will have a click-through rate of one percent.

CPL: Cost-per-lead. As the name suggests, this model means you only pay for qualified leads. You don’t have to pay just for visitors who see your advertisement.

CPS: Cost-per-sale. In this model, you only pay when a user clicks on your ad and actually purchases something as a result.

CPI: Cost-per-impression. A single impression occurs each time your ad is loaded on someone’s screen (however some actions, such as page reloads, may not be counted as impressions). When you pay through a cost-per-impression model, you’re paying for the number of times your ad is counted as viewed, even if the person who loaded up your ad doesn’t actually look at it.

CPM: Cost-per-thousand. Here the thousand refers to impressions, so in a CPM model you will pay a certain amount each time your ad is loaded 1,000 times.

Seen any other curly acronyms in the world of SEM? Let us know in our comments and we’ll do our best to untangle them for you.

[Image: yksin]


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  3. CPC vs CPM: Which Works Best?
  4. Terms Used in Online Advertising
  5. Back to Basics: Twitter Commands Explained
  6. Fewer Click-Throughs for Facebook Ads
  7. Google Instant: What Does It Mean for Marketers?

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