Advertising Definitions

Advertising DefinitionsWelcome to our advertising definitions page. On this page you can find out all the necessary advertising definitions that will help you to understand the various terms regarding ad networks.

All these terms are used by the advertising networks to describe which kind of service they offer and also other factors that you will find out when you use any ad network. In this website i also use these terms to separate the ad networks and also to describe some other factors about ad networks. So, its better to have a look of these definitions if you are newbie and don’t know these advertising terms.

Ad Network:

An Ad Network is basically an advertising company that usually serves as a broker between website publishers and advertisers. An advertising company pays its publishers for showing its sponsors ads on their websites whereas it charges advertisers for publishing their advertisements on its publishers websites. Usually Ad Networks pay its users some percentage of money that they charge from the advertisers. The most common advertisement that are sold and served by ad networks are banner advertisements.

CPM (Cost Per Mille):

Before discussing this term lets understand the meaning of “Mille”, Mille is a Latin word which means Thousand. So Cost Per Mille is also called Cost Per Thousand (CPT). CPM is an advertising model by which advertisers pay its publisher for every thousand impressions on their ads. Usually advertisers pay a fixed amount for thousand impression on their ads. Today a majority of ad networks use this model to pay its publishers.

CPC (Cost Per Click):

CPC is an advertising model by which advertisers pay its publisher for every click made on their advertisement by the visitors of the publishers site. Usually the prices range from 1¢ to over 50¢ per click. This method is widely used by the advertisers who want to pay only for the visitors who visit on their website or any product page.

CPA (Cost Per Action):

CPA is another advertising model where advertisers pay its publishers for the completion of any task or action by the visitors of the publishers site such as registering on advertisers website, purchase of any commodity, downloading a file etc. Usually CPA networks pay much higher as compared to CPM ad networks. Typically the prices range from 1$ to 25$ or a percentage of sale such as 5% or 10% commission. Most of the professional websites and blog owners use CPA networks to earn a good income through their site.

CPL (Cost Per Lead):

CPL is a variant of CPA, before discussing the definition lets understand first what is lead ?. A Lead is generated whenever a visitor from the publishers site clicks on an advertisement and makes a purchase or inquire about any commodity. So, CPL is an advertising model by which advertisers pay the publishers for generating lead for them. CPL is also called as CPI (Cost Per Inquiry).

CPS (Cost Per Sale):

CPS is also a variant of CPA, CPS is an advertising model by which advertisers pay its publishers whenever a visitor who clicked on their advertisement generates a sale. This model is used by most of the eCommerce websites.

CTR (Click Through Rate):

This is the rate at which viewers click on an advertisements. Click through rate is a method used for measuring the success of an online advertising campaign. We can easily calculate the CTR for an ad campaign by using the below formula:

ctr-formula

Fill Rate:

Fill rate is the percentage of impression that a publisher allocates with an ad network and the percentage of impressions that an ad network actually fills with paid advertising. For example: Suppose your website receives 10,000 impressions a day and the ad shown on your website receives only 5000 impressions because ad network may not have any ad to show on your site for some time that means ad network is giving you only 50% fill rate. This may happen because your ad network may not have any advertisement to show on your site, which suits your site’s traffic.

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