Key takeaways

  • Pricing terms tell you what you pay for: views, clicks, or results.
  • Performance terms tell you whether the money worked.
  • Tracking terms explain how a result is counted and confirmed.

Pricing terms

  • CPM (cost per mille): the price of 1,000 ad impressions.
  • eCPM (effective CPM): what you earned or paid per 1,000 impressions, whatever the actual pricing model was. Useful for comparing different deals.
  • CPC (cost per click): the price of one click on your ad.
  • CPA (cost per action): the price of one completed action, such as a sign-up or a purchase.
  • CPI (cost per install): a CPA where the action is an app install.
  • CPL (cost per lead): a CPA where the action is a lead, such as a filled-in form.
  • Pay-per-result: any model where you are charged only when the agreed result happens.
  • Bid: the most you are willing to pay for one impression, click, or result.

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Performance terms

  • Impression: one time an ad was shown.
  • Reach: the number of different people who saw an ad.
  • Frequency: how many times, on average, each person saw it.
  • CTR (click-through rate): clicks divided by impressions.
  • Conversion: a completed action you care about.
  • Conversion rate (CR or CVR): conversions divided by clicks or visits.
  • EPC (earnings per click): what one click earned, used mostly by publishers and affiliates.
  • ROAS (return on ad spend): revenue from ads divided by the cost of those ads.
  • ROI (return on investment): profit after all costs, divided by those costs.
  • CAC (customer acquisition cost): the total cost of winning one new customer.
  • LTV (lifetime value): the revenue one customer brings over the whole relationship.
  • KPI (key performance indicator): the number you decided to judge a campaign by.

More pricing terms

  • CPS (cost per sale): a CPA where the action is a purchase, common in affiliate marketing.
  • CPV (cost per view): the price of one video view, usually counted after a few seconds of watching.
  • CPE (cost per engagement): the price of one interaction, such as a like, a share, or a comment.
  • Revenue share: an agreement where one party receives a percentage of what the other earns, common between ad networks and publishers.
  • Daily budget and lifetime budget: the most a campaign may spend in one day, or in total.

Targeting and delivery

  • Targeting: choosing who can see an ad, for example by country, device, or age.
  • Geo-targeting: targeting by location. Worldwide campaigns often set a different price per country.
  • Retargeting: showing ads to people who already visited you.
  • Budget cap: a limit on total, daily, or hourly spend.
  • Frequency cap: a limit on how often the same person sees an ad or repeats a task.

Creative and landing pages

  • Creative: the ad itself, such as an image, a video, or a piece of text.
  • Landing page: the page people reach after clicking. It often decides whether a click becomes a result.
  • Call to action (CTA): the instruction that tells people what to do next, such as “Sign up free”.
  • A/B test: showing two versions to similar audiences and keeping the one that performs better.
  • Bounce rate: the share of visitors who leave after seeing only one page.
  • Creative fatigue: the drop in results when the same audience has seen an ad too often.

Audience terms

  • Lookalike audience: people who resemble your existing customers, found by a platform’s algorithm.
  • Placement: where an ad appears, such as a feed, a search result, a website, or an app.
  • Brand safety: keeping ads away from content that could harm your reputation.
  • Viewability: whether an ad actually appeared on screen long enough to be seen.
  • Ad fraud: fake impressions, clicks, installs, or sign-ups created by bots or dishonest sources.

Tracking terms

  • Pixel: a small script on a website that reports visits and conversions from the browser.
  • Postback (server-to-server or S2S): a direct call from one server to another that reports a conversion, without relying on the browser.
  • Attribution: deciding which ad or channel gets credit for a conversion.
  • Transaction ID: a unique ID for one conversion, used to avoid counting it twice.

Business metrics

  • ARPU (average revenue per user): total revenue divided by the number of users in a period.
  • Retention: the share of users who come back after a day, a week, or a month.
  • Churn: the share of customers who stop using or paying for a product.
  • Break-even: the point where revenue from a campaign equals its cost.
  • Conversion window: how long after a click or view a conversion still counts for that ad.
  • UTM parameters: tags added to a link so analytics tools can tell which campaign a visit came from.

Offerwall terms

  • Offerwall: a page inside a website or app that lists tasks and offers users can complete for a reward.
  • Incentivized traffic: users who complete an action because they earn a reward for it.
  • Chargeback: a conversion that is reversed after it was credited, for example because of fraud.
  • Approval window: the time an advertiser has to approve or reject a completion before it is approved automatically.

Want to go deeper? Read CPM vs CPC vs CPA, What is ROAS, and What is an offerwall.

Frequently asked questions

What is the difference between CPA and CPL?

CPL is a type of CPA. CPA covers any action, while CPL counts only leads, such as a completed contact form or a sign-up with contact details.

Is CTR or conversion rate more important?

Conversion rate usually matters more, because it measures results. A high CTR with a low conversion rate often means the ad promises something the page does not deliver.

What does S2S mean?

Server-to-server. It describes a postback that goes directly from one server to another, which is more reliable than tracking in the browser.