Paid Search Glossary (2023 Update)

Do paid search terms have you scratching your head?

If so, don’t sweat it. There are about a hundred million trillion of them, and they can get confusing. But don’t worry, we’re here to help you get a base-level understanding of the most commonly used terms that we share with our clients. 

We hope you will find this list useful as well.     

General Terms

• Ad group: One or more ads that share a similar target (e.g., diabetes devices). This allows businesses to group related keywords and write ads around a common theme.
• Ad extensions: Extra bits of information that work to enhance your ad, make it more useful to readers, and generate more clicks. Google recommends adding these universal extensions to all ads: site links, callout extensions, and structured snippets.
• Bid: A bid is the maximum amount of money an advertiser is willing to pay for each click (though often, they will pay less than the maximum).
• Campaign: A campaign consists of one or more ad groups. Each campaign has a budget and unique settings that determine where the ads appear.
• Destination URL: The landing page a user is redirected to upon clicking an ad. 
• Display URL: The webpage address that appears with your ad. It is meant to give users an idea of where they’ll arrive after clicking the ad. The destination URL, or landing page URL, is often more specific.
• Geotargeting: The method of delivering different content to users based on their geographic location.
• Keyword: High-quality, relevant words or phrases that match your ads to the terms people search for online. Two types of keywords include
  • Short-tail keywords: A general search term typically containing 1-3 words and covers a broad topic. Short-tail keywords generally have a higher search volume than long-tail keywords.
  • Long-tail keywords: A more specific search phrase typically containing 3-5 words, allowing you to target niche demographics. Long-tail keywords are generally less competitive because they’re designed to reflect a search query.
• Keyword match types: When creating an ad group, you can identify preferred match types to dictate how closely the keyword needs to match the search query to be considered for the auction. There are three main match types:
  • Broad match: This is the default match type and helps your ads reach a wider audience because it allows the ad to appear as long as all the keywords are part of the search, regardless of order. Use with caution!
  • Exact match: This match only allows your ad to appear when the query is the exact same or very similar to the keyword.
  • Phrase match: This match allows your ad to appear if there are extra words before or after the keyword.
• Negative keywords: Identifying keywords allows you to exclude search terms from your campaigns and qualify ad clicks more effectively.
• Paid search ads: Paid search ads are a type of digital marketing that allows companies to pay search engines to place their ads higher on relevant search engine results pages to drive more traffic to their site.
• Responsive search ads: Responsive search ads allow advertisers to create multiple headline and description options for each ad within an ad group.
  Over time, using AI and machine learning technologies, Google Ads automatically tests different combinations and learns which ones perform the best. Because of this ability to  adapt on-the-fly, responsive search ads often attract higher click-through rates (CTR) than standard ads.
• Query: A search engine query is every time a user enters a string of words or characters into a search engine and presses “Enter.”

Metric Terms & Acronyms

• Click: Anytime a user clicks on your ad and is taken to your destination URL (landing age).
• CPC: This stands for cost per click. It is the total cost of the ad divided by the number of clicks (e.g., $100 for 50 clicks equals $2 CPC).
• CTR: This stands for click-through rate and is a metric for measuring campaign success. It is determined by dividing the number of ad clicks by the number of impressions.
• Impression: This is the number of times your ad is shown on a search engine results page or other sites on the Google network. Impressions are not an indicator of ad engagement.
• Impression Share: This is the percentage of impressions your ads receive versus total number of eligible impressions. A low impression share means your keywords match search queries, but your ads don’t appear. There are several reasons this might happen, such as:
  • Your ad bids are too high or too low
  • Your keyword search volume is too low
  • Your ad has been paused, removed, or disapproved
  • Your ad has a scheduling or targeting mistake
  • Your negative keywords are canceling out your active keywords
  • Your ad copy isn’t optimized
  • Your landing page isn’t relevant
  • Your CTR is too low
• KPI: This stands for key performance indicator. It is a quantifiable measurement used to determine a campaign's performance. Examples of marketing KPIs for paid search include CPC, CTR, CPA, ROAS, and more.
• Optimization Score: This is an estimate of how well your Google Ads account matches Google’s optimization recommendations. Scores range from 1-100%, with 100% meaning your account is performing at its full potential.
  This score is calculated based on the results you’ve earned, your settings, and your status as an advertiser. It helps advertisers review and prioritize recommendations for active search, display, discovery, video action, app, and performance max campaigns.

Revenue & Its Many Acronyms

• Conversion: An important action the user takes (as defined by the advertiser). Examples include a call, lead form submission, file download, video view, or sale.
  
• Conversion Rate: This is the number of conversions divided by the number of clicks (e.g., two conversions divided by 100 clicks is a 2% conversion rate).
• CPA: This means cost per acquisition and is calculated by dividing the total cost of conversions by the total number of conversions (e.g., if your ad receives ten total conversions with five at the cost of $5.00 each and five at the cost of $3.00 each, your average CPA is $40.00 divided by 10, or $4.00).
• CPL: This means cost per lead and is a metric to help advertisers determine whether their efforts and marketing spend are paying off. It is calculated by dividing the total campaign spend by the number of newly acquired leads.
• CPA vs. CPL: CPL helps advertisers identify the success of a campaign, while CPA helps advertisers identify the total marketing cost to make a sale. Both are equally useful, depending on what you use them for.
  For example, let’s say you’re a SaaS company running two different ads. Each ad has the same primary objective: to generate demo requests.
  The first ad generates several requests that do not convert into customers. The second generates an equal amount of requests, but most convert into paying customers. Is it worth the effort to try to lower the CPL for your first ad? Not really. In this case, you’ll want to focus your efforts on optimizing CPA for the second ad.
• CPM: This stands for cost per 1,000 impressions and is the primary metric that dictates how much you’re going to spend on ads. Instead of paying a fee every time someone clicks on your ad, a single, predetermined fee is paid each time your ad reaches 1,000 impressions.
• PPC: Stands for pay-per-click, a less precise but still popular term for paid search advertising.
• ROAS: This means return on ad spend and is a key performance indicator (KPI) for paid search ads. It is calculated by dividing the total ad revenue by the total cost of the ad campaign. For example, if you spend $1,000 on ads and your revenue is $2,000, your ROAS is $1,000. ROAS is typically shared as a ratio. In this case, the ROAS would be 2:1 or 200%.
• ROI: This means return on investment. It is calculated by subtracting how much you earned versus how much you spend. For example, if you spend $500 on an ad campaign and generate $5,000 in sales, your ROI is $5,000 -$500, or $4,500.
• ROI vs. ROAS: ROI helps advertisers understand their overall profit, while ROAS measures the revenue success of a specific ad campaign.

More Digital Marketing Terms

• Algorithm: An algorithm is a collection of formulas that determine the quality and relevance of paid search ads and web pages based on a user search query.
• Bid strategies: Bid strategies are tailored campaigns designed to help advertisers achieve specific goals. Here are five Smart Bidding strategies
  • Maximize conversions
  • Maximize conversion value
  • Enhanced cost per click (ECPC)
  • Target CPA
  • Target ROAS
• Bounce rate: This is the percentage of single-page sessions on your website. It is calculated by dividing overall sessions by single-page sessions. A single-page session means a user left a destination URL or landing page without interacting with the page or visiting other pages.
• Google Ads: Google Ads, formerly Google Adwords, is an online advertising platform where advertisers bid to display paid search ads on the search engine results page (SERP) for relevant searches. Businesses can also use Google Ads to promote their products and services across the Google Display Network, which includes millions of partner websites and mobile apps, YouTube, Google Finance, Gmail, and more.
• Google Analytics: Google Analytics is Google’s web analytics service that tracks and reports on website and paid search traffic. It also calculates real-time paid search metrics like impressions, cost, clicks, average CPC, conversions, CTR by ad groups, CTR by ad campaigns, and more.
• Landing page: A landing page, or destination URL, is a standalone, dedicated web page where visitors “land” after clicking on a paid search ad.
• Microsoft Advertising: (formerly Bing Ads) is a smaller but often cost-effective digital paid search platform compared to Google. We typically advise clients to utilize Microsoft as an adjunct to their larger Google campaigns.
• SEM: SEM, or search engine marketing, is the process of marketing a business through paid ads.
• SEO: This stands for search engine optimization. SEO supports paid search ads by ensuring your website, content, and social profiles are poised to rank well in organic search results.
• SERP: The Search Engine Results Page is the page that a search engine returns after a user inputs a search query. SERPs return organic search results and paid search ads.
• Search volume: Search volume refers to the number of times users search for a specific keyword or phrase within a particular time frame.
• Quality score: A quality score is a diagnostic tool to help advertisers understand how their ad quality compares to other advertisers. This score is measured on a scale of 1-10 and is available at the keyword level. It is determined by several factors: ad rank, ad text, extensions, expected CTR, ad relevance, and landing page experience. Note: bid position is based upon a combination of bid amount and quality score - so a high quality score ad can appear another advertiser who bids a higher rate.

The paid search industry is constantly changing, so let us know if we've missed something important or if you have paid search terminology you think should be included. 

In the meantime, visit our paid search page to learn how we can help your business attract new patients and generate more revenue.