I realized that one of the most important blog posts in the Adsense Series wasn’t actually published on time and it was supposed to be published near the start of the series!
There are a number of terms that I use often that you’re going to not only want to recognize but also understand as they will quickly come part of your new vocabulary as you dive into Google Adsense. Please make note that a lot of these terms also apply to Google Adwords (which I might entertain for a smaller series at some point – love your thoughts on that…).
Specifically there are 10 terms that you’ll want to be aware of and they are as follows:
1. Click
A click is a click. Pretty simple, right? If one of your blog readers sees one of your Google Adsense advertisements and clicks on the advertisement then it’s recorded in your account as a “click.” You’re going to want to make sure to monitor your clicks to see how many people click those advertisements.
This is also important if your advertising with Google to see how many people come to your site through the advertisements that you might create for traffic generation and promotion.
2. Impressions (Impr.)
Many people get confused and mistake impressions for the same thing as pageviews or visits to a site but they are not the same thing – impressions are the number of times one of your Google Adsense advertisements are displayed on your blog or on other particular sites.
Knowing the number of impressions (and where) is important to understand the value that those advertisers are bringing to your blog and how they are being exposed to your audience.
3. Cost per Impression (CPI)
This is a fairly simple concept and it’s simply the way advertisers, marketers, and you, the blogger can quantify the value of an impression. The most common unit is per thousand (see below) but some advertisers use different quantities. You can pick and choose your own as you wish, of course.
4. Cost per Thousand (CPM)
This is the cost per 1,000 impressions for an advertisement. You’ll see this term used a lot. Here’s a most basic example:
- $10 CPM means that it costs $10 per 1,000 impressions or views of that advertisement.
- If you’re blog gets 10,000 impressions per month then an advertiser can reasonably spend (and you pocket) $100 for that spot based on a strict CPM model.
Not too hard to understand, right?
5. Clickthrough Rate (CTR)
You’ve already heard the term CTR a few ties and it’s simply this: It’s the number of clicks an advertisement receives divided by the number of impressions (the number of times the ad is shown on your blog).
The higher your CTR the higher the relevance and strength of a keyword in terms of your blog and blog content as well as the potential for financial earnings.
6. Cost per Click (CPC)
The CPC of an advertisement is the cost that the advertiser pays for each click on their advertisement on your site (or how much you pay per click when someone clicks on your advertisement).
The higher the CPC the higher the value of the click to the resulting destination and the more you will have to pay (and/or the more you can possibly earn).
7. Pay per Click (PPC)
This is the same thing as CPC but you’ll find that some people, publishers, and bloggers prefer one term over another – it’s simply preferential.
It’s good to know that some advertisers offer flat-rate PPC (CPC) while others have a network-based bidding approach – the difference is that an advertiser can declare a simple flat-rate for a click to the advertiser while the latter has a network of advertisers bidding on keywords and the highest bidder gets to show their advertisement on the spot, based on their budget and spend.
8. Cost per Action (CPA)
This is also know as Pay per Action (PPA) and is more specific than just clicks. An advertiser, for example, can charge each time a specific action occurs, like signing up for a a newsletter, clicking through a specific number of links (in order), requesting more information, etc.
The cost varies based on the requirements. The success rate is typically understood as the CR or Conversion Rate. See next.
9. Conversion or Conversion Rate (CR)
A “conversion” simply means “action” – or in other words, a conversion happens when one of your readers completes an action on your site, such as requesting more information, filling out a form, clicks through to another page or site, etc.
You ultimately want to have a high-conversion blog where advertisers want to seed their content on your blog so that they can get a great return on their investment and advertising dollars.
10. Banner Blindness
One of the constant challenges of any advertiser and blogger is to create an advertising solution and strategy that mitigates what is commonly understood a “banner blindness,” the phenomenon in web usability where readers ignore banner advertisements, either consciously or subconsciously.
You want to make sure your advertisements aren’t annoying but create value for your readers and visitors. We’ll talk more about this anecdotally throughout this series.
Whew, there you go!
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