The five programmatic terms you need to know


By Alison Withers

Over the past few years, programmatic advertising has made its mark on the digital advertising world in a big way. It seems that everyone from mega corporations and B2B companies to car dealerships and mom-and-pop shops are now taking part. And programmatic advertising isn’t just here to stay – it’s growing in popularity every year.

A quick Google search will show just how deep and technical the world of programmatic can be. So what do you, as an advertiser, need to know before dipping your toe in the programmatic pool?

Though it’s impossible to explain all of the programmatic lingo out there in a single blog post, here are the first five terms you should learn before getting started in the world of programmatic advertising.

1)      Impression

An impression, put simply, constitutes a single time that your ad is served on a website domain or an app. If your ad is seen on a weather website on a desktop screen, that is one impression. If your ad is seen on an app on a mobile device, that counts as one impression. On a tablet? Yes, that’s an impression too. If you’ve purchased 600,000 impressions to be delivered over six months, you have purchased 600,000 times that your ads are seen on a device in the span of six months. 

2)      CPM

As programmatic advertising is all about strengthening brand identity and being seen by the right users, impressions are typically bought and used by the thousand. The cost associated with purchasing a thousand impressions is your CPM, or “cost-per-mille”. A campaign with a $20 CPM means that each thousand impressions would cost you $20.

So if 1,000 impressions costs $20, how much would 20,000 impressions cost? Time to break out that high school math!

There are 20 units of 1,000 in 20,000. Therefore, 20 units at 20$ each would cost $400.

Or, in math terms:

20,000 ÷ 1,000 = 20

$20 x 20 = $400.

3)      Click

Every time someone clicks on your ad and is sent to your landing page counts as one click. But it’s important to remember that a prospect doesn’t necessarily need to click on your ad for it to make an impact on them. Similar to a billboard, your ads can resonate with users at any time in their online journey, regardless of whether they click or not.

4)      CTR

Click-Through Rate, also known as CTR, is a well-known KPI across all programmatic campaigns. This percentage sits far below 1%, and often even below 0.1%, and marks the percentage of how many of your ads/impressions received a click. If you received 100 clicks, and delivered 100,000 impressions, your CTR would be 0.1%. Like clicks, CTR is a great KPI to gauge your campaign’s success, but it isn’t the only indicator of a strong campaign. And even with a great CTR, don’t expect your CTR to go any higher than an extremely low percentage, hovering between a 0.08-0.15%. Instead of fixating on CTR, it’s best to focus on your web traffic throughout your campaign, and the amount of increased true prospects heading to your website.

5)      Pixel/Cookie/Code/Tag

A pixel (also called a “cookie”, a “code”, or a “tag”) is the critical piece of coding needed to track your prospects who visit your website. By adding this code to your webpages, we are able to track those who spend time on your website and retarget them with your ads later.

These pixels can also track the amount of users who see your ad, don’t click on it, yet still come visit your website after seeing your ad. Either these users pull up a new tab, or jot down your name and make a point of returning later. We call these sneaky users “view-through users”.

As well, these pixels can also serve as conversion pixels, which have the ability to tell you which users move through your website and lands on a success page, thereby “converting” into a sale or tangible lead.

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With a solid understanding of these five terms, you’ll be talking like a programmatic pro at your next team meeting. But your know-how shouldn’t stop here – like all amazing and innovative marketing strategies, programmatic advertising is a huge, burgeoning field, with plenty more to learn and discover.

To learn more, contact us today to find out how our programmatic campaigns can help build your brand and increase your web traffic. And keep checking in on our blog, where we will be continuing to post about programmatic and digital display advertising!