*This is part 2 of a series, The Ultimate ABCs of Programmatic Advertising. For part 1, click here.

We recently launched this series as an aid for every digital marketer out there who has ever been   confused, annoyed, or even a bit frustrated with all the programmatic advertising jargon out there.

In this series, “The ABCs of Programmatic Advertising,” we set out to help you get fluent with all the specific terms and acronyms.

Today, we breakdown all the B’s and the C’s.

Banner

A web banner or banner ad is a type of advertising you’ll find online and can be delivered on desktop or on a mobile device. Banner ads are the billboards of the digital world and one of the earliest online ad formats as standardized by the IAB.
One of the earliest banner ads was this infamous AT&T ad which ran on HotWired.com back in October 1994 (Business Insider).

Bid

Like the lingo used in stock markets, a bid is the price advertisers are willing to pay for an ad impression. In real-time bidding (RTB), the buying and selling of online ad impressions in the real-time it takes a web page to load, an auction occurs for every impression. The advertiser’s bid is facilitated by a DSP (Demand Side Platform) or through an exchange. For the advertiser to win the auction with their bid, their bid must be higher than all others.

As technology has evolved and targeting parameters improved, the winning bid must also be a strong fit or match for the targeted audience visiting the website at any given time.

Bid Request

When a visitor loads a webpage, bid requests occur in the browser. This is when the ad server requests the ad exchanges which the publisher works with for an auction to take place to buy/sell a specific ad impression. The bid request is sent to buyers through the exchange and received on their DSP which in turn submits their bids in the auction for the impression. The winning bid is then served onto the web page to the visitor – all of this happens within a 100 milliseconds.

Brand Safety

One of the key goals for publishers and advertisers on both sides of the ad trading cycle: to ensure their brand integrity, or brand safety. Ad placements alongside objectionable or inappropriate content can be damaging to a brand, and this is a big concern.

As the digital advertising industry developed over the last five years, brand safety has become a priority.

Brand safety can therefore also refer to the practice of brand protection and use of ad verification tools to prevent objectionable content from being placed on a publishers’ site or vice versa. Some adtechs, like ClearPier, offer multi-level security measures that include technology and human verification.

Click-Through-Rate (CTR)

Click-through-rate (CTR) is the number of clicks that your ad receives divided by the number of times your ad is shown: clicks ÷ impressions = CTR. For example, if you had 5 clicks and 1000 impressions, then your CTR would be 0.5%.

Cost Per Action (CPA, A.K.A Pay Per Action or PPA)

CPA stands for ‘cost per action’. It is an online advertising pricing model wherein advertisers only pay when a completed action occurs, rather than for a set volume. Nearly anything can constitute an ‘action’ from impressions, to clicks, to leads (completed forms), views, or a sale. The desired action is dependent on the advertiser and the goal of each campaign. CPA is the basis of the pricing model for all Performance Advertising.

There are numerous variations of CPA that differ based on the final goal or action: CPA PC (cost per action post view), CPA PV (cost per action post view), CPL (cost per lead), CPC (cost per click), CPV (cost per view), CPI (cost per install).

Cookie

Not quite that type of cookie. In the digital world, a cookie is a small piece of data, or tracker that runs on web browser to track and identify a user’s online behavior and browsing habits.

Conversion

When someone, a potential customer, completes a pre-defined action and/or goal of a campaign such as a click, filling out a lead form, or completing a purchase.

Conversion Rate (CR)

A campaign’s conversion rate is the measure of ad clicks that ultimately result in conversions. To calculate conversion rate, you divide the number of conversions by the number clicks and multiply by 100. For example, you’ve made 100 t-shirt sales (conversions) after 1000 clicks: 100/1000 x 100 = 10% CR.

Cost Per Mille (CPM)

Cost Per Mille (CPM or cost-per-thousand) is another online advertising pricing model where buyers pay on the basis of every thousandth impression or view. CPM is not a new pricing model but was used in print advertising originally.

Cross-Device Tracking

Cross-device tracking is the many ways in which publishers, advertisers and ad tech identify and trace audience behaviour across numerous platforms and devices including desktop, tablets, and mobile phones. The goal? To provide a holistic view of the individual audience member’s behaviour online, regardless of the device they’re using, and enable proper, relevant ad retargeting.

Customer Lifetime Value (CLV)

Customer Lifetime Value (CLV), also known as Lifetime Customer Value (LCV), or life-time value (LTV), is the projected net profit a customer will generate during their time as a customer of your business. There are various ways to calculate your CLV, depending on your business model and goals. Check out this great infographic by Kissmetrics which looks at Starbucks as a case study on calculating CLV.

If you didn’t know, now you know.

Stay tuned for more in upcoming posts in this series. Next up, we explore and define the D’s – G’s of Programmatic.