With words entering the lexicon constantly, it’s a good idea for performance marketers to study up on some new industry jargon.

Because performance marketing encompasses a variety of different disciplines, including affiliate marketing, search, interactive advertising and lead generation – each with its own terminology – it can be difficult to keep up. Just getting a handle on this ever-changing industry can be a full-time job, never mind the time it takes to decipher cryptic acronyms. Planning an Internet marketing strategy is complicated. Will you get the best ROI from a CPA, CPC, PPL or a hybrid model? And how will you track your CPM and determine your CTR?

You are not alone if this question overwhelms you. Although many people who are new to the online marketing space understand the basic principles, they lack the essential vocabulary. And like any industry, it greatly helps if you can talk the talk and walk the walk.

 

To excel in online marketing, you have to communicate effectively with your design and development teams, your clients and potential strategic partners.

To assist those who are new to the Internet marketplace, we have compiled a list of essential Internet marketing vocabulary. Although this guide is most helpful to newbies, we think even more advanced affiliate marketers will find some useful information here.

And because this industry includes search and e-commerce, you can find an expanded list of key terms on our website. We will update that list regularly with new words that pop up in this constantly moving space.

A

Abandonment: When a user leaves a shopping cart with an item in it prior to completing the transaction.

Advertiser (also Merchant or Retailer): Any website that markets and sells goods or services. In affiliate marketing programs, advertisers contract with affiliates to get consumers to register for services, purchase products, fill out forms or visit websites.

AdSense: An advertising program run by Google enabling website owners to display text and image advertisements. Revenue is generated on a pay-per-click basis. Google uses its search technology to serve ads based on website content and users’ geographical location.

AdWords: Google’s text-based advertising system. It is cost-per-click (CPC) advertising and publishers pay only when users click on their ad. It has cost-control features that can set daily budget and limits.

Affiliate: A website owner that earns a commission for referring clicks, leads or sales to a merchant.

Affiliate Fraud: Bogus activity generated by an affiliate in an attempt to generate illegitimate, unearned revenue.

Affiliate Link: A piece of code residing in a graphic image or piece of text that is placed on an affiliate’s webpage, notifying the merchant that an affiliate should be credited for the customer or visitor sent to their website.

Affiliate Manager: The manager responsible for overseeing the marketing of a merchant’s program including forecasts and budgets, as well as communicating with affiliates regularly, establishing incentives and monitoring industry news and trends.

Affiliate Network: An intermediary between an affiliate and merchant. For merchants, it offers tracking technology, reporting tools, payment processing and access to affiliates. For affiliates, it offers a one-click application to merchants, reporting tools and payment aggregation.

Algorithm: A set of mathematical equations or rules that a search engine uses to rank the content contained within its index in response to a particular search query.

Analytics: Technology that helps to analyze the performance of a website or online marketing campaign.

Arbitrage: A practice through which Web publishers – second-tier search engines, directories and vertical search engines – engage in the buying and reselling of Web traffic.

Auto-Approve: An affiliate application approval process where all applicants are automatically approved for an affiliate program.

B

Backlinks (also Inbound Links): All the links that point at a particular webpage.

Banner Ad: An electronic ad in the form of a graphical image that is available in many sizes and resides on a webpage. Banner ad space is sold to advertisers to earn revenue for the website.

Behavioral Targeting: The practice of targeting and serving ads to groups of users who exhibit similarities in their location, gender or age, and how they act and react in their online environment.

Bid: The maximum amount of money that an advertiser is willing to pay each time a searcher clicks on an ad. Bid prices can vary widely depending on competition from other advertisers and keyword popularity.

Browser Helper Object: A DLL module designed as a plug-in for the Microsoft Internet Explorer Web browser to provide added functionality. Some modules enable the display of different file formats not ordinarily interpretable by the browser.

C

Chargeback: An incomplete sales transaction (for example: merchandise is purchased and then returned) that results in an affiliate commission deduction.

Click & Bye: The process in which an affiliate loses a visitor to a merchant’s site once they click on a merchant’s banner or text link.

Click Bot: A program generally used to artificially click on paid listings within the engines in order to artificially inflate click amounts.

Click Fraud: The deceitful practice of posing as pay-per-click traffic for the purpose of generating false revenue by the affiliates serving the ads. In PPC advertising terms, it generates a charge per click without having actual interest in the target of the ad’s link.

Clickthrough Rate (CTR): The number of clicks an ad receives, divided by the total number of times that ad is displayed or served (represented as: total clicks / total impressions = CTR). For example, if an ad has 100 impressions and 3 clicks, the CTR is 3 percent.

Client: A software program that is used to contact and obtain data from a server software program on another computer. Each client program is designed to work with one or more specific kinds of server programs and each server requires a specific kind of client.

Cloaking: A deceptive process that sends search engine spiders to alternative pages that are not seen by the end user. Search engines record content for a URL that is different from what the visitor sees in order to obtain more favorable search positions.

Cobranding: A website or page to which affiliates send visitors that includes their own logo and branding.

Commission (also Referral Fee, Finder’s Fee, Bounty): The income an affiliate receives for generating a sale, lead or clickthrough to a merchant’s website.

Compensation Rate: The rate at which an affiliate receives money in exchange for goods or services. It is how affiliates are paid and should be stated in the affiliate contract.

Contextual Advertising: The term applied to ads appearing on websites or other media where the ads are selected and served by automated systems based on the content displayed by the user.

Contextual Link: The integration of affiliate links with related text.

Contextual Search: A search that analyzes the page being viewed by a user and gives a list of related search results.

Conversion Rate: The number of visitors who convert after clicking through on an ad, divided by the total number of clickthroughs to a site for that ad. (Expressed as: total clickthroughs that convert / total clickthroughs for that ad = conversion rate.)

Cookie: Small file stored on a visitor’s computer that records information. For affiliate programs, cookies have two functions: to keep track of what a customer purchases and to track which affiliate was responsible for generating the sale and is owed a commission.

Cost Per Acquisition: The cost metric for each time a qualifying action, such as sales and registrations, takes place.

Cost Per Action (CPA): The cost metric for each time a commissionable action takes place.

Cost Per Click (CPC): The cost metric for each click to an advertising link.

Cost Per Lead (CPL): The cost an advertiser pays per qualified lead.

Cost Per Order (CPO): The cost metric for each time an order is transacted.

Cost Per Sale (CPS): The term for advertising in which the advertiser pays only for those clicks where the user clicks through on the banner or ad and actually purchases a product on the advertiser’s site.

Cost Per Thousand (CPM): The cost metric for 1,000 banner advertising impressions. The amount paid per impression is calculated by dividing the CPM by 1,000. For example, a $10 CPM equals $.01 per impression.

Crawler (also Spider, Robot or Bot): Component of a search engine that gathers listings by automatically trolling the Web and following links to webpages. It makes copies of the webpages found and stores them in the search engine’s index.

Custom Feed: Enables submission to XML feeds for each of the shopping engines. The engines have different product categories and feed requirements.

Customer Bounty: The merchant payment to an affiliate partner for every new customer that they direct to a merchant.

D

Dayparting: The ability to specify different times of day – or day of week – for ad displays, as a way to target searchers more specifically. An option that limits the serving of specified ads based on day and time factors.

Data Feed: A text file that contains the information needed to generate a website. It is provided either directly to the affiliate or indirectly through a network. The affiliate then converts the data feed into a database, which is then used to populate webpages full of products.

Deep Linking: Linking to content buried deep within a website.

Delisting: When webpages are removed from a search engine’s index.

Demographics: The term that refers to specific information about a population or a target market. Demographics include information such as age, sex, geographic location, and size of the group.

Destination URL: The specific location within a site where the user who has clicked on the ad should be directed. The destination URL does not have to match the display URL but should be in the same domain.

Distribution Network: A network of websites or search engines and their partner sites on which paid ads can be distributed. The network receives advertisements from the host search engine, paid for with a CPC or CPM model.

Domain Name: Controlled by the worldwide organization called ICANN, domain names are obtained on a first-come basis and are used to identify a unique website.

Doorway Page (also Gateway Page): A webpage created expressly in the hopes of ranking well for a term in a search engine’s non-paid listing. It does not deliver much information but is designed to entice visitors to enter.

Dynamic Content: Information of webpages which changes, or is changed automatically.

E-F

Earnings Per Hundred Clicks (EPC): Earnings or average payout per hundred clicks.

Earning per Thousand Impressions (EPM): Earnings or average payout per thousand impressions.

Eighty Twenty Rule: A rule of thumb that dictates that typically 80 percent of the products sold in a product category will be consumed by 20 percent of the customers.

Escalating Commission (also Sliding Scale): A compensation system based on an increase in the money paid to an affiliate. It is a percentage commission that increases based on the achievement of certain targets, such as specific number of copies sold.

Feeds: A Web document that is a shortened or updated version of a webpage created for syndication. Usually served at user request, through subscription; also includes ad feeds to shopping engines and paid-inclusion ad models. Ad feeds are usually in eXtensible markup language (XML) or rich site summary format.

Freemium: A business mode that offers basic services for free, or is ad supported, but charges a premium for advanced or special features. The model is popular with Web 2.0 companies that acquire companies through referral networks, organic search marketing and word of mouth.

Frames: An HTML technique that allows two or more pages to display in one browser window. Many search engines had trouble indexing websites that used frames, generally only seeing the contents of a single frame.

G-H

Gateway Page (also Doorway Page): A webpage created in hopes of ranking well for a term in a search engine’s nonpaid listings.

Geographical Targeting: The analytical process of making decisions on the regions and locales on which a company should focus its marketing efforts.

Hit: Request from a Web server for a graphic or other element to be displayed on a webpage. Sometimes the misleading term hit is not the same as a visitor.

Hybrid Model: An affiliate commission model that combines payment options (i.e., CPC & CPA).

I

Impression: An advertising metric that indicates how many times an advertising banner, link or product on the Internet is viewed.

Inbound Link: A link to a particular page from elsewhere on the Internet. Inbound links are important to SEO because many search engines’ rankings are at least partially based on the amount of inbound links.

Index: The database of webpages maintained by a search engine or directory.

Interactive Agency: An agency offering a mix of Web design and development, Internet advertising and online marketing, or e-business/ e-commerce consulting.

K-L

Key Performance Indicators (KPI): Metrics that are used to quantify objectives that reflect the strategic performance of online marketing campaigns. They provide business and marketing intelligence to assess a measurable objective and the direction in which that objective is headed.

Keyword(s): The word (or words) a searcher enters into a search engine’s search box. Also the term that the marketer hopes users will search on to find a particular page.

Keyword Buys: The act of bidding on specific search terms related to a specific industry.

Keyword Density: The number of repetitions of a keyword as a percentage of the total word count of a webpage. For example, if a webpage has 200 total words on it and 20 of them are keyword advertising, then the keyword advertising has a 10 percent keyword density on the page.

Keyword Domain Name: The use of keywords as part of the URL to a website. Positioning is improved on some search engines when keywords are reinforced in the URL.

Keyword Marketing: The method of getting a message in front of people who are searching through the use of particular words or terms.

Landing Page: The specific webpage a visitor reaches after clicking on a search engine listing, pay-per-click ad or banner ad.

Lead Generation: Websites that generate leads for products or services offered by another company. On a lead generation site, the visitor completes a contact form to get more information about a product or service. The submitted contact form is considered a lead.

Link Bait: A useful, entertaining, creative Web content or Web tool that encourages website owners to link to it.

Linkspam: A company attempts to place as many inbound links as possible to its site regardless of the context of the originating site.

Listing: The information that appears on a search engine’s results page in response to a search.

Loyalty Affiliates: Affiliates who offer incentives to their members with cash-back or other benefits and rewards to shop through their website. Often they own cash-back shopping websites.

M-N

Manual Approval: An affiliate application approval process where all applicants are manually approved for an affiliate program.

Merchant Account: An account with a payment processor for settlement of credit card transactions. Any merchant that takes credit card orders must establish a merchant account.

Meta Tag: A way to describe various aspects of a webpage that is not intended for users to see. Meta tags pass information to Web crawlers and spiders along with browsers and other applications.

Minimum Bid: The least amount that an advertiser can bid for a keyword or keyword phrase and still be active on the search ad network. This amount can range from $0.01 to $0.50 or more for highly competitive keywords, and is set by the search engines.

Multilevel Marketing (also Two-Tier Marketing): Affiliate program structure whereby affiliates earn commissions on their conversions as well as conversions of webmasters they refer to the program.

Nanopublishing: An online publishing model that uses a small-scale, inexpensive operation to reach a targeted audience, especially through blogging. Sometimes communities of shared interest emerge quickly online, such as PaidContent.org and Gawker.com.

Niche Sites: A website oriented toward a very specific topic or audience. Niche sites often have high traffic and items can bring higher prices than on general purpose sites because they serve customers looking for unique content.

Opt-in Email: Email information that the recipient explicitly requests such as a newsletter or eZine.

Optimization: Changes made to a webpage specifically to improve the positioning of the page on search engines.

Organic Search Results: Non-paid search engine results (also called natural search) – the pages that search engines find in a vast index of the Web that the search engine determines are the best matches for the search keywords.

Outbound Link: A link on a webpage leading to other webpages both on the same website and other websites.

Page Rank: An indicator of the value of a webpage that is used for ranking in search engine results and that is governed by a proprietary formula by search engines. It is based on factors including the number and quality of links to a website and the content of the website itself.

Page View: The term for the loading and screen presentation of a single webpage.

Paid Inclusion: Advertising program where pages are guaranteed to be included in a search engine’s index in exchange for payment.

Paid Listings: Listings that search engines sell to advertisers usually through paid placement or paid inclusion.

Paid Search: Paid search often referred to as pay per click (PPC) is a strategy used by a large number of affiliates.

Parasite: Software that works on a person’s computer, typically without their knowledge or consent and without a visible interface. It can include software that is installed along with another application.

Pay Per Call: A model of paid advertising similar to PPC, except advertisers pay for every phone call that comes to them from a search ad, rather than for every clickthrough to their website landing page for the ad.

Pay Per Click (PPC): A program where an affiliate receives a commission for each click they refer to a merchant’s website. PPC offers some of the lowest commissions and high conversion ratio since visitors need to only click on a link to earn the affiliate a commission.

Pay Per Impression (PPI): An advertising pricing model in which advertisers pay based on how many users were served their ads.

Pay Per Lead (PPL): A program where an affiliate receives a commission for each lead that they generate for a merchant website such as completed surveys, contest or sweepstakes entries. Pay per lead generally offers midrange commissions and midrange-to-high conversion ratios.

Pay Per Sale (PPS): A program where an affiliate receives a commission for each sale of a product or service that they refer to a merchant’s website. Pay-per-sale programs usually offer the highest commissions and the lowest conversion ratio.

Q-R

Query: The word (or words) a searcher enters into a search engine’s search box.

Quality Score: Reflects an ad’s historical CTR, keyword relevance, landing page relevance and other factors proprietary to Google. Yahoo refers to it as a Quality Index.

Rank: How high a particular webpage or website is listed in a search engine’s results.

Really Simple Syndication (RSS) Feed: A data format for syndicating news and other content. Subscribers to RSS feeds are notified every time content is updated on a particular site.

Reciprocal Link: A link exchange – the process whereby two websites’ owners agree to display a link to each others’ sites.

Residual Earnings: A program that pays affiliates not just for the first sale, but all additional sales made at the merchant’s site over the life of the customer.

Revenue-Sharing Program: A program that allows merchants and website owners to increase sales. The host site links to the merchant site with a banner, button or text link, for a fee. The merchant pays the website owner for increased traffic, sales and leads from the host site.

S-T

Search Engine Marketing (SEM): Tactics that seek to promote websites by increasing their visibility in search engine results. SEM methods include SEO, paid placement and paid inclusion. It includes the practice of buying paid search listings with the goal of obtaining better free search listings.

Search Engine Results Page (SERP): The page the search engines returns to after a visitor entered a search query.

Search Engine Optimization (SEO): The practice of altering a website so that it does well in the organic, crawler-based listings of search engines. The process usually involves choosing targeted and relevant keywords and phrases that will drive traffic to the site.

Shopping Cart: The term for software that is used to make a site’s product catalog available for online ordering, whereby visitors may select, view, add, delete and purchase merchandise.

Social Network: Online networks of communities who share interests and activities or who are interested in exploring the interests and activities of others, which necessitates the use of software.

Spamdexing: Also called search engine spamming. It combines techniques employed by some Web marketers and designers to fool a search engine’s spider and indexing programs to ensure that their website always appears at or near the top of the list of search engine results.

Spider: A software program that crawls the Internet by following links and indexing webpages.

Sponsored Listing (also Paid Listings or Paid Sponsors): A term used as a title or column head on search engine results pages to identify paid advertisers and distinguish between paid and organic listings.

Spyware: Generally refers to deceitful software that is secretly installed on a user’s computer and that monitors use of the computer in some way without the user’s knowledge or consent. Most spyware tries to get the user to view advertising and/or particular webpages.

Super-affiliates: The best affiliates in a program based on performance and earnings, usually the top 1 percent, who generate the majority of revenue for a program.

Targeted Marketing: The act of making the right offers to the right customer at the right time.

Text Link: A link that is not accompanied by a graphical image.

Tracking Method: The way a program tracks referred sales, leads or clicks. The most common is by unique Web address for each affiliate or by embedding an affiliate ID number into the link that is processed by the merchant’s software.

Trademark Poaching: The act of using PPC ads to appear as though they have come from a merchant (using its trademark). When clicked on, the ad directs the consumer to the trademark owner’s site through a link that inserted the affiliate ID, generating a bogus commission for any resulting purchase.

Trusted Feed (also Paid Inclusion): A trusted feed is a fee-based custom crawl service offered by some search engines. These results appear in the ‘organic search results’ of the engine. Typically, the fee is based on a ‘cost per click,’ depending on the category of site content.

V-Z

Visitor Segmentation: Differentiating of users to site by categories such as age, sex, etc.

Visit: Measurement that has been filtered for robotic activity of one or more text and/or graphics downloads from a site without 30 consecutive minutes of inactivity and which can be reasonably attributed to a single browser for a single session.

Web 2.0: Also referred to as the Semantic Web. In this iteration, sites, links, media and databases are ‘smarter’ and able to automatically convey more meaning than those of today.

Widget: A small application designed to reside on a PC desktop or within a Web-based portal or social network site offering useful or entertaining functionality.

XML (eXtensible Markup Language): Its primary purpose is to facilitate the sharing of structured data across different information systems. It is used both to encode documents and to serialize data.