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As a business owner, understanding digital advertising can be pretty overwhelming.

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With terms like impressions, click through rates, re-targeting CTR,

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cost per click, ROAS and other terms being thrown around, it's really

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easy to get lost in the jargon. However, having a basic understanding of these terms can be crucial.

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To making informed decisions for your business.

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And getting the most out of your advertising budget. And this episode.

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I'm going to break down all of the digital advertising terms that you need to know.

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Hey guys, my name is Kyle from Social Geeks Digital Agency, and if you

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didn't know already digital advertising has become an essential part of

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the marketing for small businesses. With the rise of social media and search engines, there are more opportunities than

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ever before to reach your target audience.

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However to make the most of these opportunities, you're

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going to need to know a few of these key key terms and concepts.

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So starting from the top of your digital advertising.

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being shown to your audience? This has nothing to do with clicks or the amount of times

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that you've reached a person. Impressions are simply a measure of how many times your ads

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have been shown to your target. audience. Impressions and reach are different because reach is how many people

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you've actually reached with your ads as unique people.

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these are clicks on your ad or if they're clicks to your website.

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With Facebook ads for example, people can click on your post or they

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might click read more, or they might like, comment, share, et cetera.

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And that will be counted as a click. You also want to be looking at outbound clicks to make sure that you know how many

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people are clicking through your website. Which leads me to the next important statistic, click through rate.

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This is a percentage of how many impressions your ads have received versus

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how many clicks you've had on your ad.

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The higher your click through rate, the more engaged your audience is.

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And this is generally a good sign that your ads are targeting the right

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audience and have the right message. We look at click-through rate as one of the key metrics to understand

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if our ads are effective and if our audience targeting is correct.

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It's important to look at your click through rate for both clicks on Facebook

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ads, but as well as your click through rate for outbound clicks as well.

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According to multiple benchmark reports.

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The standard click through rate for Facebook ads is around 1%.

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So if you're doing better than that, you're pretty much on par

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with what the average would be. Now, bear in mind, it's going to vary from industry to industry, from

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company to company, but that's a good benchmark to compare yourself against.

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looking at is your cost per click. It's pretty self-explanatory but this is the cost that you

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pay for every click on your ad.

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This is a common pricing model for all ad platforms.

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So you'll see this on Google, Facebook. LinkedIn, Pinterest, TikTok, and all of the other digital advertising platforms.

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the stands for cost per mil. It's supposed to be a cost per a thousand impressions.

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It's just gives you a bit of an understanding in terms of how much

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is it costing you to place a thousand ads in front of your audience?

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Again, this is going to vary from platform to platform bodies, to audience, business,

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to business industry, to industry, but at least you can compare apples to

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apples and you can also see if your costs are going up over time or going down.

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This is a great one to look at for seasonality changes.

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This always goes up by like 30% or more around Christmas and black Friday, because

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everybody wants to jump on the advertising bandwagon and get their brand out there.

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Another great metric that we like to look at side by side with your CPM or cost per

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mill cost per a thousand impressions, is your cost per a thousand people reached.

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This is more commonly on Facebook and other social media platforms.

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The reason we look at this is to see are we targeting a very expensive audience?

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For example, with your retargeting ads, ads that are being displayed towards

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your website, visitors, to try to get them to buy your cost, to reach a

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thousand people is going to be sky high.

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Whereas if you're targeting. All of the Australia or all of the US, your cost to reach a thousand people

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might be very low because the platforms will try to place your ads competitively

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for you using machine learning to get you the best price, at least we hope!

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Conversion rates are vital to look at because this is really

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what you want as a business. This is the most important thing as a business to be looking

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at; are your ads converting?

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Now your conversion rate is a percentage of all the people who clicked on your ad.

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Who have been converted into the action that you want to take.

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For all ad platforms, you define your conversions.

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This could be as simple as a phone call to your business or getting directions down

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to signing up for a form or signing up to your email newsletter on your website.

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Or it could be downloading a free guide or lastly purchasing a product.

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Your conversion rate is crucial because this is going to tell you how effective

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your ad is driving real results.

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Retargeting is a form of advertising that targets people.

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Who have previously interacted with your brand? Let's give you somebody who's visited your website at a

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depart to their shopping cart. They've interacted with your profile on Instagram or Facebook.

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But because they didn't take the action that you wanted to take, which is most

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likely purchasing a product or becoming a lead in your marketing funnel.

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Then retargeting is going to advertise to that audience again, with a

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separate message, something that's a bit more salesy or using customer

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reviews, testimonials to show them that they should buy with you.

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Retargeting is highly effective because it's targeting people who have

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already interacted with you, which means that they're much more likely

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to take that next step and convert. The next term is your frequency.

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ad frequency or your frequency rate. The frequency refers to the number of times an individual sees your ad.

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It's incredibly important to be looking at your frequency right on your ad campaigns

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to make sure that it doesn't get too high. As this can lead to ad fatigue and is statistically shown to reduce

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the likelihood of your audience, taking that next step with you

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or engaging with your brand. If you look at your marketing funnel in terms of top of funnel, middle

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of funnel and bottom of funnel. Generally, you want to keep your top of funnel below four, if you can, your middle

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of funnel below, let's say seven and your bottom of funnel where you're really

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trying to retarget and get people to convert we try to keep that well below 10.

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These again are just general numbers. It does depend on business to business, but I find that that's quite an effective

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frequency rate to keep it below for e-commerce businesses, especially.

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​ So what is an ad that work well, it's essentially a platform that connects.

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Advertisers with publishers. Ad networks like the Google display network.

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Is really beneficial because it allows advertisers to reach very large audiences

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on websites and mobile apps that they might not be able to connect with.

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Websites and mobile apps are able to put space on their website and

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their blogs are on their banners. And through ad networks, you're able to place your ads to be seen on set websites.

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So a good way to think of ad networks is like a marketplace for

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advertisers and content publishers to kind of come together and

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effectively exchange services. ​

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It's automated buying and selling of ads.

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This is generally done through the platforms, algorithms and data to

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optimize ad placements and targeting.

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Another term that I've been throwing around a lot is native advertising.

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Native advertising simply means that you're trying to create ad

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content that looks almost exactly the same as the content you'd

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expect to see on that platform.

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A good example would be that you try to create ads for Facebook.

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That looked very similar to Facebook posts. So this could be a blog article from your website.

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That's talking about some tips on digital marketing.

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Rather than an ad for sign up for our Google ads management service,

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it's a very different approach. And it means that you're actually trying to create content that

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looks native on Facebook. Native ads are great because they'll generally drive a lower cost per click

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a higher click through rate, and that's because they feel like regular content.

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Making them less disruptive to the end user.

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And offering a better user experience. The next advertising term is AB testing or split testing.

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All AB testing means is you have two variations of an ad or a landing page, a

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headline, any type of variation that you'd like to test to see what's more effective.

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And you can love this into your ad platform to say, I want to

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test version a versus version B.

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And what that platform will do is it will target the same audience

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with all the content in the same, except for version a and B.

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And drive 50% here, 50% there.

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And the great thing is you'll be able to measure all of the metrics that

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we've just gone through to see which one is performing better, which one

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gets a lower cost per click, which one gets a higher click through rate,

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which one gets a higher conversion rate, which one gets you a higher ROAS.

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Which we're gonna talk about next. AB testing is a central for any digital advertising campaign, because it's

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going to help you optimize your results to get better and better over time.

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And next I'm going to talk about ROAS or return on assets.

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Return on ad spend is when you look at how many dollars in sales am I making

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for every dollar I'm spending on ads.

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So if I spend $1 on Facebook ads, does it make me $2 in sales?

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What if so and that would be a two ROAS or a 200% return on ad spend.

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This doesn't factor in things like your cost of goods, sold your management

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fees, Anything else it's basically looking at the return on your ad dollars.

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What we as an agency will work on with our clients is finding what is an acceptable

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profit threshold for you to be breaking even and adding a buffer to that, to

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say this is what we're aiming for. Some businesses have a lot of repeat purchases from customers, so They're

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willing to spend more to acquire customers because they know the lifetime value

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of that customer will be quite high. Say it costs you $30 to get a new customer from a facebook ad and

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you're selling them a $30 product what your return on ad spend would be 1.

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Because for every dollar you're spending on facebook You're

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getting $1 back in sales. However if the lifetime value of your customers on average is $300.

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Then you know that you're getting a 10 times return over

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the lifetime of your customer. So it's important to look at roas In the big picture not just as i need to be

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making a profit but all of my ads although if you can get it above your profit

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threshold you can scale that baby up and i bought another video that talks about

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How i feel one of my clients to $500,000 in revenue in less than three months

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multiplying their advertising because they had a healthy return on ad spend.

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The last and final term i'm going to throw at you is your landing page.

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A lot of people ask me what is a landing page and it doesn't

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need to be anything fancy. It is essentially the first page that people land on on your

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website when they click on an ad. Generally you want to design custom landing pages for your promotion

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because you're going to have a much higher success rate at converting

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them If your landing page or your webpage Is designed to be Exactly the

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right messaging for that promotion. For example, You wouldn't want to run an ad promotion where your ad

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is talking about 10 tips for your small businesses digital marketing

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and then send them to a homepage that has none of that information.

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That's a really bad user experience, and it means that it's completely

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irrelevant to the ad you're promoting. You want to have a landing page that talks about 10 tips for digital

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marketing for small businesses. That makes a lot more sense!

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But your landing page you can customize and you can tailor it you can split test

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it or A/B test it to see what works best.

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Is having an offer at the very top of my page more effective?

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Or should i have the content straight away?

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i have another episode that talks all about optimizing your landing

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pages for success and i highly recommend checking that out too.

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In conclusion, digital advertising can be very complex.

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But understanding these key terms And concepts Is essential

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for small businesses to succeed. Now that you have run through some of these key terms with me you

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should have a better understanding Of What these terms mean And It'll

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help you with getting better results from your advertising campaigns.

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By familiarizing yourself with The terms outlined in this Episode

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You can make informed decisions And improve the effectiveness

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of your digital advertising too. If you do want any help with your digital advertising i would love to go and offer a

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free audit of your google or facebook ads.

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i've been managing google and facebook ads for the last seven years, and

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have helped hundreds if not thousands of businesses grow and scale

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through their advertising results. If you'd like to do that i'll drop a link in the description so that you can book

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in a free consultation and we can take things from there thank you so much for

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tuning in and I wish you guys all the best for digital marketing take care!