Digital marketing is an incredibly important part of any business, but often the jargon can be really puzzling. As a business owner, you know the ins and outs of your industry but if you are new to digital marketing, acronyms such as CPC and CPA can get confusing. Here’s a guide on some common digital marketing jargon to help get you up to speed.

CPC (cost per click)

‘Cost per click’ is the pricing model where businesses are charged by publishers for every click someone makes on an ad which leads potential clients to your website.

Let’s say you are an electrician in Bondi, the keywords ‘electrician in Bondi’ will be bid on by hundreds of other cafes wanting to advertise on Google. Every time your ad is clicked, you pay per click. The demand for that keyword will determine how much that click costs. A word or subject that doesn’t have a lot of demand will be lower in cost. So we will try find niche keywords that other marketing agencies may not have thought of (but are still searched for by your ideal potential customers), so we can get lower cost of clicks.

CPA (cost per acquisition)

At the most basic level, your ‘cost per acquisition’ is how much you are spending on your marketing to sign up a new customer. You essentially look at your marketing spend and divide it by the number of customers that resulted from those activities, to determine how much it cost to acquire those new customers. You can also use that formula to determine how much you need to spend for a potential client to take an action leading to a sale, such as visit your website.

So this means if the cost per click in your industry is $5 and you want 100 people to come to your website so that you can get one new client, then the cost is $500 to get that client. Even though you are not a digital marketer, it is important that you know your CPA so you can measure your return on investment.

CTR (click through rate)

The rate of clicks that your online ad receives compared to other ads is called your ‘click through rate’. If for every 100 times an electrician business appears in google, they have seven clicks on their website, that would make their CTR 7 per cent. This is where expert copywriting comes through to attract attention and compel people to click your ad, and where you need to make sure that you have a digital marketing agency that understands your business and customer’s requirements.

Conversion

This is the desired action taken by a visitor. Simply, conversion is getting a potential client to respond to your call-to-action. So, for example, getting people to go to your landing page and filling in an online form is one way of seeing your conversion. The big question is: did your call-to-action convert to customers? The ultimate conversion is booking that new big client that came from your online ad. If you aren’t getting $2 for every $1 you put in to your digital marketing, then something is wrong.

Keywords

Keywords are the really important terms that showcase what your business is all about. So if you specialise in corporate then your keywords would be around electrician and corporate. It’s all about understanding the intent behind someone’s search, and knowing the burning questions they have about choosing an electrician. So you need to understand what your potential client would be typing into a search engine in order to find a company like yours. Once you find your keywords you can then use those in your lead-generating content.

ROI    

Another term that should be in every digital marketer’s jargon, is ROI – return on investment. Metrics like CTR (click through rate) are important markers for a how a digital campaign is progressing, but they are not measures of success. Enquiries that lead to sales are the only measure of success that matters. So make sure your digital marketing agency is motivated to help grow your business.

Edited extract from the best-selling book, Sell Like Crazy, by Sabri Suby, founder of Australia’s fastest growing digital marketing agency, King Kong. The book covers all facets of digital marketing and illustrates the path to success with real-life case studies where Sabri has used the exact same selling system to supercharge their business. The book is now available at all good bookstores and online at www.kingkong.com.au