Glossary of Digital Advertising Terms

Digital advertising has revolutionized small business marketing. How? It makes reaching a new audience and customers easier than ever before. If you are brand new to digital marketing it can feel like learning a whole new language. In this comprehensive glossary of digital advertising terms, we’ve compiled a list of essential words or phrases you need to know.

Understanding Different Digital Advertising Platforms:

Let’s start by covering most of the various platforms you can use to advertise your business online. While we specialize in Google, Facebook, and Instagram ads there are a whole host of different platforms to choose from to advertise your business.

Amazon Advertising: Advertising within the Amazon marketplace, promoting products with sponsored product listings and display ads. To run these ads you must sell your products on Amazon.
Bing Ads (Microsoft Advertising): Microsoft’s advertising platform for displaying ads on the Bing search engine, Yahoo, and other Microsoft-owned properties. These ads are similar to Google ads but reach Microsoft users.
Facebook Ads: Facebook’s advertising platform for creating targeted ads on its social media platform. These ads can target people by age and gender demographics, and can also target by interest.
Google Ads: Google’s advertising platform for displaying ads on Google search and its affiliated properties including Google search, YouTube, and over three million websites through the Google Display network.
Instagram Ads: Instagram’s advertising platform which is integrated with Facebook Ads, it offers visual ad formats on the Instagram platform.
LinkedIn Ads: LinkedIn’s advertising platform for reaching a professional audience and targeting users based on professional criteria such as job title, company name, and industry.
Pinterest Ads: Advertising on the Pinterest platform, promoting pins and visual content. Content targeted to women tends to perform well on Pinterest.
Snapchat Ads: Advertising on the Snapchat platform, using video ads, sponsored lenses, and filters to engage a younger audience. Snapchat is a great platform for local brands or targeting geographic locations.
TikTok Ads: Advertising on TikTok, using in-feed ads, branded effects, and hashtag challenges to reach a younger and engaged audience. While in some ways TikTok has more restrictions than other advertising platforms, you have the ability to reach a much wider audience.
“X” (formally known as Twitter) Ads: X’s advertising platform for promoting tweets, accounts, and trends to a global audience.

Terms for Measuring Digital Advertising:

When you are running digital campaigns it’s important to understand the value that they bring to your business. There are many ways to track your digital campaigns – and not every type of campaign is going to have the same methods of tracking available. The following are terms you should know when discussing the strength of digital advertising efforts.

Average Cost Per Click (CPC): The average cost paid by an advertiser for each click on their ad.
Click-Through Rate (CTR): The percentage of users who click on an ad after seeing it. CTR is calculated by dividing the total number of clicks on the ad by the total number of impressions
Clicks: The number of times users interact with an ad by clicking on it.
Conversion Rate: The percentage of users who take a desired action after clicking on an ad. A conversion can vary from one business to another. For example, a conversion could be users filling out a contact form, or it could be fully completing a purchase. See this blog for a detailed understanding of how conversion rates impact your website and business.
Cost per Conversion: The cost an advertiser incurs for each successful conversion. This is typically based on the cost per click but could be based on cost per 1,000 impressions (CPM).
Cost Per Mille (CPM): This is the cost per 1,000 impressions – Mille is Latin for thousand. Typically this cost is considered for display ads.
Impressions: The number of times an ad is displayed to a user regardless if that is in search results or display images.
Pay-per-click (PPC): Pay-per-click advertising is any form of digital advertising where the advertiser pays based on click performance.
Quality Score: A metric used to evaluate the relevance and quality of keywords, ads, and landing pages.
Return on Ad Spend (ROAS): This measures the revenue generated from ads relative to the advertising spend. To measure this you divide the revenue attributed to your ad campaign by the cost of that campaign.
Return on Investment (ROI): A measure of campaign profitability, calculated by subtracting costs from revenue and dividing by costs.
Search Impression Share: The percentage of times an ad is shown compared to the potential number of times it could have been shown.

Types of Digital Ads

Between Google and social media platforms and more, there are many ways your ads can appear online. Here’s an overview of the different types of ads you can expect to see online.

Google Ad Formats

Hundreds of thousands of businesses use Google Ads. Why? Google Ads are a great way to get your business in front of your audience on Google and other websites online. These ads are a form of pay-per-click (PPC) advertising. Google Ads can reach users through their searches on Google, through image-based ads on more than two million websites, videos on YouTube, Google Maps, and more. With Google Ads, you have control over your budget and where your ads are placed; hundreds of thousands of businesses use Google ads to promote their business every day.

Search Ads

Search ads may be the first thing you think of when considering Google Ads. These ads show up in the search results when someone searches for a topic related to your ad. You bid on individual keywords or phrases relevant to your business, then Google runs their algorithm to see what ads and what organic results show up at the top of the page.

These ads are best for: Any business can use search ads. However, since standard Search campaigns effectively act as the answer to the searcher’s question, they can be particularly effective for businesses trying to drive leads or purchases.

Display Ads

Instead of text-based ads that appear when someone is actively searching for something (search ads), display ads are image-based and show passively on websites within the Google Display Network (GDN) as people browse them. Display campaigns are all about who you’re showing ads to and where. Instead of targeting keywords, you target placements, audiences, and topics.

These ads are best for: Driving brand awareness! Display ads achieve high volumes of relevant impressions for a low cost. Increased brand awareness leads to better results with your other campaigns.

Shopping Ads

Shopping campaigns are useful for any business selling physical products online. They are the visual ads you see on the Search and Shopping tabs on Google. This ad campaign is created out of a feed of your products that you give to Google. This includes all of the information about your products and allows people to see an image of the product.

These ads are best for: E-commerce businesses looking to increase sales online.

Demand Gen Ads

A new Google ad type is Demand Gen ads. These ads are a great way to reach new customers who are ready to take action. Similar to display ads, Demand Gen ads appear in the Discover Feed on mobile devices and the Google phone app, Gmail, and YouTube. Because these ads are formatted to look like the content we expect to see in these locations, these ads often have higher click-through rates and ROI than traditional display ads.

These ads are best for: All brands could benefit from Demand Gen ads, they help to drive both awareness and action.

Video Ads

Video ads can be shown on YouTube videos or website content. These campaigns function similarly to Display campaigns in that you bid to have your video show on specific placements on YouTube or across the web to specific audiences. The main difference is that Video campaigns have different types of ad formats available. Keep in mind that creating a great video is just the start of this campaign, making these ads more expensive than Display ads.

These ads are best for: If you have a budget to produce high-quality video ads they are an amazing way to show off your product. Since they function similarly to Display campaigns, this type of Google Ads campaign can also be ideal for those who are looking to drive brand awareness in specific target markets.

While different types of social media platforms may call their ad types by different names, they tend to fall into similar categories. We’ll dig into each type of ad below. Keep in mind that the advertising on social media must match your audience and the tone of the platform. For example, an ad that would perform well on LinkedIn is unlikely to get the same results on TikTok. The various social media advertising terms are defined below.

Social feed ads are a common and versatile form of social media advertising. These ads appear directly within users’ social media feeds, whether it’s Facebook, Instagram, X, or other platforms. They can include various ad formats, such as images, videos, carousels, and story ads.

These ads are best for: Social feed ads are suitable for a wide range of businesses and objectives. They can be used for brand awareness, lead generation, and product promotion. It’s important to be an active user of your social media platform for these posts to perform well.

Social commerce ads blend e-commerce and social media, allowing users to shop directly within social platforms. These ads often feature product listings, shopping tags, and a seamless purchase experience without leaving the platform.

These ads are best for: E-commerce businesses aiming to drive online sales and increase conversions.

Video Ads

Video ads are a dynamic form of advertising on social media. They can take various forms, including in-feed videos, live-streamed content, and stories. Video ads are highly engaging and effective in conveying a brand’s message. Currently, video content has a high value on social media and gains more attention than static content.

These ads are best for: Businesses seeking to captivate and educate their audience through compelling visual content.

Story Ads

Story ads are short-lived vertical videos or images that appear in the stories section of social platforms like Instagram, Facebook, and Snapchat. These ads offer a more immersive and interactive experience.

These ads are best for: Creating buzz, sharing limited-time promotions, and engaging with the younger, mobile-savvy audience.

Carousel Ads

Carousel ads enable advertisers to showcase multiple images or videos in a single ad unit that users can swipe through. This format is excellent for highlighting various products, features, or a storytelling narrative.

These ads are best for: Businesses with diverse product lines, storytelling campaigns, or content-rich advertising.

As the digital ads landscape continues to evolve, understanding these key advertising terms is essential. Whether you’re an advertiser, marketer, or simply someone interested in advertising, understanding these terms is useful for discussing advertising projects. Keep this glossary handy for quick reference as you dive into the world of digital advertising.

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