Chapter 1 & 2 Flashcards
What does digital marketing include?
Internet marketing
Social media marketing
Display advertising
Search engine marketing
Big Data
The act of assessing and storing large amount of information for analytics.
Display advertising
A mode of online advertising where marketeers use banner ads and other visual ad formats to advertise their products on websites, apps, or social media.
Search Engine Advertising (SEA)
Advertisers who utilise search advertising show their ads to users who are actively searching for specific keywords.
Factors on which the cost of advertisement or commercial depend
Quantity (in which you buy the advertising space)
Audience size (reach) - most important one
Type of advertisement (print, sound, video)
Target audience (how broad/specific)
Size and proportion of the advertisement
Most important factor of advertisement/commercial cost
The audience size.
This one is dependent on the channel, newspaper, and time or broadcast.
(e.g., during Superbowl).
Difference between traditional media and online advertising
with online advertising, you have full control over who sees the ad, banner, or video.
Moreover, with online advertising, everyone sees different ads, while with traditional media, everyone sees the same ad.
Cost per Click (CPC)
This is the amount to be paid per click on an ad.
You only pay if someone actually clicks on the ad.
CPM Calculation
Total costs / (banner impressions / 1.000 ad impressions)
Focus: CPC
Here, the goal is to create traffic to the website.
Goal: creating awareness.
Here, the focus should be on CPM
A found ROI of 87.5% is rather unrealistic. When can it only be realistic?
If the company is completely new, people don’t know about it yet, and when the company uses this method for the first time.
Calculation CR
Number of conversions / number of clicks
OR
number of conversions / total amount of (banner) impressions
The outcome *100 gives the conversion rate percentage.
Conversion Rate (CR)
Records the percentage of users who have completed a desired action.
CTR Calculation
Number of clicks / total amount of (banner) impressions
Click-Through Rate (CTR)
This it the ratio of users who click on a specific link compared to the total number of total users who view a page, e-mail, or advertisement.
CPA Calculation
Total costs / amount of conversions
CPC Calculation
Total costs / amount of clicks
Cost per Action/Acquisition (CPA)
This is the amount to be paid when a click on the ad led to a certain action.
E.g., filling out a form, buying a certain product, subscribing to a service.
Cost per Mile (CPM)
This is the amount to be paid per 1.000 ad impressions.
Advertisers don’t pay for clicks on the ad, but they pay every time the ad is shown.
Different types of payment schemes
CPM: Cost per Mile
CPC: Cost per Click
CPA: Cost per Action/Acquisition
Goal: create revenue
Here, the focus is on CPA.
Choosing the payment scheme (is dependent on)
The goal of the company (create awareness, create traffic on website, or create revenue).
Organic search results
Left side of the web page.
Sponsored search results
Left side of the web page.
Difference between organic and sponsored search results
With sponsored search results, the company has to pay Google each time there is a click.
With organic search results, the company does not have to pay Google when there is a click.
Reason people use sponsored search results (and thus pay Google)
Because most attention is given to the first few search results.
Party that benefits the most from sponsored search results
Unknown companies, since they are relatively unknown and cannot easily create their own content online to attract people.
Important factors for Google when selecting websites
- Have unique content.
- Make the content fit a few specific keywords on which it has to perform well.
- Optimise the technical site of your website.
- Making sure good external sites link to you, including social media.
System used by Google
Second Price Auction
Second Price Auction - explanation
advertisers don’t need to pay what they bid, but just enough to outbid the position below them.
Factors that decide Google’s ranking position
- Quality of the landing page.
- Amount of money a company is willing to pay.
- Relevance of the ad.
- The expected click-through rate.
Where the quality score (QS) is based on.
- Relevance of the ad.
- Expected click-through rate.
- Quality of the landing page.
Factors that determine the Ad Rank Score
- The Bid
- Quality Score
- Impact of the ad’s format
Factors that determine the typical cost per click
- The topic (sector)
2. The keyword
Is a high online ad ranking always better?
No. It is dependent on the context. Moreover, the higher ranking leads to visitors on the company’s website that are not actually interested in the product, but just click on it because its the first option offered to them. (Unwanted clicks)
By placing lower on the ranking in e.g., Google, you can have a higher likelihood of reaching your company’s actual customers; the ones that do are willing to buy or want to buy the product.
Display banner adverising
One of the first and oldest forms of advertising.
Real-Time Bidding (RTB)
Refers to the practice of buying and selling ads in real time on a per-impression basis in an instant auction.
At a given moment, multiple advertisers can bid on a single impression of a publisher’s inventory. Then, the winning ad (with the highest bid) is shown to the user. This yield a better ROI and more specific customer targeting.
Two ways banner ads are effective
- You see it, click on it, and visit the website through the ad.
- You see it, don’t click on it, but remember the company and visit it later.
Look-alike audience targeting
Segmentation tool that finds users whose demographics and interests are similar to those of existing followers.
(This) influences the re(targeting) method:
The stage of the purchase funnel the customer is in.
Earlier stage: generic retargeting.
Later stage: dynamic retargeting.
Generic retargeting
Customers are shown generic brand ads when browsing external websites.
Dynamic retargeting
Creating unique ads for each individual customers.
In most cases, this involves machine learning technology that analyses individual behaviours to figure out which creative elements will entice an individual to return and make a purchase.
Behavioural retargeting
The practice of segmenting customers based on web browsing behaviour, including things like pages visited, searches performed, links clicked, and products purchased.
Contextual targeting
The practice of displaying ads based on a website’s content.
Four types of (re)targeting / online advertising methods
- Behavioural targeting.
- Contextual targeting.
- Dynamic retargeting.
- Generic retargeting.
Retargeting (banner advertising)
Enables you to remind your customers of your products and services after they leave our website through buying it. It allows you to show your visitors relevant ads when they visit other sites.
It is thus based on the customer’s history, leading to an increased effectiveness. But, on the other hand, the customer might already had interest in purchasing.
