Author: Tiara Rea

Are you ready to take your website to the next level by advertising it on Google, Yahoo, or other popular search engines and websites? How do you know PPC from ROI? How do you know what defines a good campaign, what terms are used when measuring that campaign, or even what a campaign is?

Well, I’m here to go over some of the most popular online advertising definitions along with some information to assist you in marketing your website.

Important Definitions

* ROI. Return on Investment. This just means, how much did you make in any given campaign? People calculate ROI differently, but a popular way to measure it is by taking the cost of your investment and subtracting that from your total profit. Then, take that number and divide it by the cost of investment. But it really depends on what you want to measure: i.e. If you just want to make any profit, even if it’s just $1 more than you put in, you would look at your results differently than if you wanted an ROI of 50%.

* CTR. Click-Through Rate. This is merely a way to measure the success of your campaigns: i.e. how many people clicked on your ad before they purchased? Obviously, the less people the better, because if 1 out of every 2 people clicks on your website, you know you’re doing something right. You can find the CTR for any campaign by dividing the number of clicks by the number of total impressions. For example, if your ad was viewed 100 times and 15 people clicked on it, your CTR would be 15%.

* PPC. Pay-Per-Click. This is a term used often in online advertising and is the most popular way to advertise these days. It just means that you are paying on your campaign only when a potential customer clicks on your ad. For example, if you bid $5 per click and 10 people click on your ad, you would pay $50. PPC campaigns can get quite costly, dependent on your industry, but can also be really worthwhile, as you are only paying for actual leads (in this case, clicks to your website).

* CPA. Cost Per Acquisition. If you’re a member of our Affiliate Program, you should know this term well! CPA just means that you are paying only for every time someone completes an order on your site: i.e. Lunarpages pays its affiliates $65 every time someone purchases web hosting via their referral. There are other ways to set this up as well: i.e. every time someone applies for registration, every time someone asks for a Quote from your company, or every time someone fills out a certain form, etc. This can be a really lucrative advertising strategy, because you are only paying for actual results.

* CPM. Cost Per 1,000 Impressions. Just like it sounds, you’re paying per impression or page view. So if you had to pay $2 CPM and you had 2,000 impressions, you would only owe $4. Depending on how many impressions a website gets, this can be pretty cheap. Just be careful you don’t get roped into paying $20 CPM for a website that gets 50,000 page views/day. Looks cheap until you add it up!

* Affiliate Marketing. An Affiliate Program works on a CPA basis, wherein you only have to pay every time someone does what you want them to do – i.e. buy something, get a quote from you, call you, etc. The most successful Affiliate Programs reward their affiliates for promoting their website via Affiliate Tracking URLs. For example, Lunarpages Affiliate Program uses a tracking URL that stores a cookie to track all your sales. For Affiliate Marketing, you should have a website that is easily marketable in your industry. Check your competition’s websites to see if they have a head start.

* Pay Per Post. This is a fairly new technique bloggers have been implementing for the past couple of years now. Since bloggers make up a huge percentage of traffic and views on the internet, some popular bloggers will charge you to post about your product to their readership. Posts can range from a few bucks on a not-so-popular blog to hundreds of dollars for the big guys showcasing the big products. If you are marketing to a specific niche of potential customers likely to read these blogs, this can be very successful. The biggest downside is that paid bloggers must normally report each paid post, so some customers may not want to purchase with you if you’re paying someone to recommend your product.

* Contextual Advertising. With contextual advertising, your ad is displayed dependent on keywords used on other websites in a given advertising network. Ad networks like Google or BidVertiser can place your ads right in the middle of articles, news reports, blogs, etc. These can be very cheap depending on the websites advertised on and tend to perform well, as your ad will relate directly with the content your potential customers are reading.

Next month I’ll go more in-depth on some of these methods but for now, you have a general outline of what options you have in the world of online advertising.