While being potentially very profitable, Facebook advertising is also hard to master. One of the things that makes Facebook advertising difficult to learn is the large number of advertising and marketing concepts that you need to understand in order to effectively run Facebook ads.
Online learning materials such as blog posts, white papers, and e-books are filled with technical advertising jargon and can be challenging to understand. Almost all of the important advertising metrics and terms also have their own acronyms which you need to remember in order to be able to comprehend various learning materials.
69 Advertising Terms You Need to Know
We’ve prepared a list of the 69 most important advertising terms that you need to master in order to run profitable Facebook advertising campaigns. They are listed below in alphabetical order.
Add To Cart (ATC) – the number of add-to-cart events tracked by the Facebook Pixel that can be attributed to your ads.
Ad Auction – Just like Google, Facebook works as an auction platform. For each ad impression, Facebook decides which one to present based on the ad’s maximum bid and the effectiveness of that same ad. The more engaging the ad is, and the more money you spend, the bigger the reach of your ad will be.
Ad Account – Ad Account is the grouping of all your specific Facebook activities. For example, you can have one ad account for each project/client you’re working with. It includes different campaigns, ads, billing information, etc.
Ad Set – In Facebook Ads Manager, Ad Sets are, essentially, the groups of one or more ads. There, you can define your targeting, scheduling, ads, and other parameters.
Ad Frequency – Ad Frequency is the Facebook advertising term that describes how many times you want one user to see your ad. If you set your ad frequency on, for example, 10 – that means that every user will see your ad approximately ten times.
Amount Spent – The Amount Spentisaterm in your Facebook ad manager denoting the section that lets you see the total amount of money you spend running your Facebook ads (across all of your campaigns in a specific time).
Ad Name – the name of some specific ad campaign.
Ad Placement – Ad Placement describes where on Facebook’s interface you want to insert your ad. There are multiple Ad placements you can choose from depending on your goals and targeting. Currently, available ad placements are Facebook Feed, Instagram Feed, Facebook Stories, Instagram Stories, Messenger and Audience Network.
Audience Network – Audience Network is one of the placements you can choose for your Facebook Ads. It allows you to show your ads outside Facebook or Instagram, in the places where your target audience gathers after they leave their Facebook accounts. It proves to be a great way of achieving an omni-channel presence.
Average Order Value (AOV) – a metric that measures the average dollar value of each order or sale made on your website. It is calculated by dividing the total revenue by the total number of orders. AOV is one of the most important metrics you need to be keeping an eye on in order to determine your pricing and advertising strategy.
Bottom of Funnel (BOFU) – last stage of the sales process. During this stage, the customer is already interested in purchasing from your company but might need some questions answered before making the final decision.
Boost Button – This is the button you can see behind your Facebook and Instagram posts on your feed. It is essentially a shortcut that enables you to quickly boost your posts, although its functionality is more limited than Facebook Ad Manager.
Button clicks – the total amount of clicks the buttons on your Facebook ads have attracted.
Bid – the money you are willing to spend per campaign action (1000 views, per click, etc.).
Campaign ID – the unique ID number of a particular campaign.
Campaign Budget Optimization (CBO) – an option that allows Facebook to automatically optimize the distribution of your campaign’s budget across all the ad sets in your campaign. It is designed to help you get the best results possible with your available budget.
Click-Through Rate (CTR) – the percentage of people who saw your ad and then clicked on it. Calculated by dividing the total number of clicks by the total number of impressions. It can help you determine how effective an ad is in driving traffic to your website.
Conversion Campaign – type of Facebook campaign that is focused on getting people to take your desired action. You can choose goals of conversions, such as web visits, online form submission, etc.
Conversion Rate (CVR) – the percentage of ad clicks that converted into a sale. It’s calculated by dividing the total number of sales (conversions) by a total number of clicks.
Conversion Rate Optimization (CRO) – the process of optimizing your ads to provide more conversion.
Cost per Click (CPC) – the average cost of one click on your Facebook ad. It is also one of the most commonly used metrics for determining the efficiency of an ad campaign.
Cost per Engagement (CPE) – the average cost of a user engaging with your ad. It is calculated by dividing total ad spend by the total number of engagements.
Cost per Thousand Impressions (CPM) – the average cost of showing your ad to a thousand people. CPM is used to determine the cost-effectiveness of your campaign.
Cost per Action (CPA) – the average cost of a visitor performing an action on your ad. It is calculated by dividing your ad spend by the total number of actions performed.
Cost per Purchase (CPP) – the average cost of a purchase driven through your ads. It is calculated by dividing the total ad spend by the total number of purchases.
Cost per Offer Claim (CPOC) – If you run offer Facebook campaigns, you will encounter this type of metric within your Facebook Ads Manager. It is the cost of each claim that is made of your offer. An offer is any type of coupon, promotion, or code you promoted through Facebook’s Offer ads.
Cost per Lead (CPL) – the total amount spent divided by the number of total leads you have got from your campaign. A lead is someone who completed your online form, downloaded the e-book, or completed any other action you wanted them to.
Cost per Page Engagement – the Total Amount Spent divided by the number of engagements you got on your Page.
Cost per Page Like (CPPL) – the Total Amount Spent divided by the number of likes you have got to your Facebook page.
Cross-Sell (XS) – a sales technique used to encourage a customer to purchase a product that is related or complementary to the product they have already added to their cart. Facebook allows you to set up cross-sell campaigns using dynamic ads.
Custom Audience (CA) – a type of audience you can create for your Facebook advertising campaigns using customer data such as email addresses or phone numbers. To create a Custom Audience, you will need to upload your customer list to Facebook.
Customer Lifetime Value (CLTV / LTV) – a metric that provides the prediction of the total lifetime profit that can be attributed to a specific customer. CLTV is crucial in helping you determine how much you can afford to spend on acquiring a customer.
Daily Budget – the total daily budget you have set to spend on your Facebook campaigns.
Downsell (DS) – a sales technique that involves offering the customer a cheaper product when they want to give up on purchasing the product they were initially interested in. The goal of down-selling is to make sure to acquire the customer, even if it means making less profit on that particular sale.
Dynamic Product Ads (DPA) – a type of Facebook ad that automatically promotes your products to people who have visited your website or app. You will need to upload your product catalog to Facebook in order to be able to use Dynamic Ads.
Facebook Pixel – the unique Facebook snippet you can copy and paste to your website. Once you do that, Facebook Pixel will automatically collect all the data of people who visit your website. Later, you can use that data to create custom or lookalike audiences on Facebook.
Initiate Checkout (IC) – the number of Initiate Checkout events tracked by the Facebook Pixel that can be attributed to your ads.
Impressions – the total number of times your ad has been viewed.
Landing Page (LP) – a dedicated page on your website where people who click on your ads are sent to. They are usually built using specialized builder software.
Landing Page Views (LPV) – the number of times your landing page was viewed by someone who clicked on your ad.
Lead Generation Campaign – Facebook allows you to create a Lead Generation Campaigncontaining short forms, called Instant forms directly on Facebook. Its purpose is to reduce friction and help you get more leads directly from Facebook.
Lookalike Audience (LAL / LAA / LLA) – a type of audience you can create for your Facebook advertising campaigns by using an existing Custom Audience. A Lookalike Audience consists of people who are similar to the people in your Custom Audience.
Lifetime Budget – the total amount of money you are willing to spend during the entire campaign.
Link Click – total number of clicks on the link inside your ad.
Middle of Funnel (MOFU) – the middle stage of the sales process. Here the customer is presented with your product or service as a solution to their problem.
Mobile App Instal – the total number of mobile app installs you’ve got through your Facebook campaigns.
Mobile App Activated – the total number of people who installed and started to use your mobile app through Facebook campaigns.
Objective – In Facebook Ad Manager, the objective is essentially the goal of your Facebook campaign. It can be getting traffic, getting engagement, app installs, etc.
Optimized Cost Per Mile (oCPM) – this Facebook Ad Manager feature allows you to set the max bids on your campaign based on the desired campaign outcomes (e.g. the engagement, form fills, app installs, and more).
One-Click Upsell (OCU) – a type of upselling offer where the customer is offered to add additional items to their cart with a single click.
One-Time Offer (OTO) – a type of upselling offer where the customer is offered to add additional items to their cart, but only for a limited amount of time.
Offline Events – You can import 3rd-party data into your Facebook Campaign (e.g. the list of your newsletter subscribers). Later, Facebook will use this offline data to build a better audience or to show your ads to them if they have not seen them already.
Page Post Engagement (PPE) – a campaign objective that, when selected, tells Facebook to try to find people in your audience who are most likely to engage with your posts.
Page Engagement – the total engagement you have got on your Facebook Page.
Paid, Owned and Earned Media (POEM) – This is a common term among digital marketers and Facebook advertisers. Paid Media are ads like PPC or Facebook ads. Owned Media are the channels you own, such as websites, Facebook pages, etc. Earned Media are the channels where you “earned your reputation”, such as Quora, Facebook Communities, and other groups.
Partner Categories – These are the advanced targeting options, based on user information acquired from 3rd party providers, such as Experian or Epsilon.
People Taking Action (PTA) – Facebook’s term for the total number of people who took action on your Facebook ad.
Potential Reach – Estimated reach Facebook informs you about before launching your campaigns is based on your target audience, reach, positioning, etc.
Reach – the total number of people you have reached with your Facebook ad.
Retargeting (RT) – the practice of advertising products or content to people who have already interacted with your content in some way. To be able to run retargeting campaigns on Facebook, you will need to place the Facebook Pixel on your website.
Return on Investment (ROI) – the overall return on the amount of money, time, and resources you invest in Facebook advertising.
Return on Ad Spends (ROAS) – one of the most important advertising metrics. It’s used to measure the performance of an advertising campaign. To calculate ROAS, divide the total revenue generated by the advertising campaign by the amount of money spent on the campaign.
Source Audience – the 3rd party audience used to create custom or lookalike audiences on Facebook.
Top of Funnel (TOFU) – the first stage of the sales process. This stage is usually used to educate the customer on a problem they may be having.
Up-Sell (US) – a sales technique used to encourage a customer to purchase a more expensive product than the one they are considering. Facebook allows you to set up upsell campaigns using dynamic ads.
Video Views (VV) – the number of times your Facebook video ad was viewed for three seconds or more.
View Content (VC) – a type of Facebook advertising campaign optimization which aims to optimize your ads for receiving as much traffic as possible for a specific landing page.
Website Conversion (WC) – a campaign objective that, when selected, tells Facebook to try to find people in your audience who are the most likely to convert. You will need to install the Facebook Pixel on your website in order to use Website Conversions as your campaign objective.
Website Conversion Value (WCV) – the total value of converting someone on your website. It is usually the average price of your products or the average lifetime value of your users (if they are subscribed g to your product/service).
There you have it. The 69 advertising terms you need to know in order to run profitable Facebook advertising campaigns. Whether it is ATC, AOV, or just VV, understanding these terms can make you quick on your feet and put you ahead of the game.
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