Amazon Advertising Glossary of Metrics & Essentials

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In recent years, Amazon has not only expanded its position as a sales platform but has also strengthened its role as an advertising platform. It’s not without reason that Amazon Advertising is now on a par with Google Ads, Facebook and other big advertising platforms in the marketing mix of many companies. In a very short time, the campaign, ad and targeting options in Amazon Advertising have grown rapidly – and so has the list of Amazon PPC-specific terms. That’s why we’ve created this “cheat sheet” to help you expand your knowledge around digital marketing terms in general and Amazon PPC terms in particular – and refresh it at any time.

A9 Algorithm

Amazon’s algorithm to prioritize and display products in search results.

ACoS (Advertising Cost of Sales)

ACoS defines the relationship between the budget you have set aside for a PPC campaign and the return you expect to get from that campaign. It tells you how much of each dollar spent on a PPC ad was actually spent on the advertising itself. In short, you can calculate ACoS simply by using this simple equation: ACoS = (Ad Spend / Ad Revenue) * 100.

Ad

Online advertisement is the direct marketing technique that instantly allows entities to reach out to many people via the internet.

Ad group

A structural element in an advertising account. An ad group contains one or more ads that share similar targets.

Ad spend

Ad spend is the monetary amount of money that you’re spending on advertisements. Depending on how you measure ad spend, you could calculate direct ad spend, or you could include costs for ad agencies and other ad marketing staff.

Adspert (Brand)

For medium to enterprise-level businesses and agencies who want to increase their sales and have issues managing & optimizing their advertising campaigns, Adspert is a digital advertising optimization company that provides an AI-Powered PPC optimization and analysis platform, so our customer can maximize their profits, reduce the time spent, expand their markets, and improve their results.

Advertisement

Advertising is a form of communication that uses an officially sponsored, non-face-to-face message to advertise or sell a product.

Advertising account

An account on an ad platform, such as Amazon Ads, Google Ads.

Advertising creative

Advertising creative is an object that contains all the data for visually and textually representing the ad itself.

Advertising format

The type of advertisement that you use. Examples include Sponsored Display, Sponsored Brand, Product Display Ads.

Advertising objective

The goal that you want to achieve from digital advertising. Examples include brand awareness, consideration, purchase, and loyalty.

Advertising placement

The place where an advertisement appears. Examples include search queries on Amazon.com, Amazon devices (such as Fire TV or Fire tablet), and third-party sites.

Advertising platform

Technology for driving traffic. For instance, Google Ads or Amazon Ads are the major ad platforms in online advertisement.

Amazon Coupons

Amazon Coupons is a self-service tool that lets sellers create compelling promotions in digital coupons that show up in search results. Coupons can be used to offer discounts as either a percentage or set dollar amount and can be targeted to select customer segments.

Amazon Seller

Type of Amazon advertising account. A dealer in the Amazon seller program sells her/his goods on her/his own on the Amazon marketplace.

Amazon Stores

Vendors and third-party sellers enrolled in Amazon’s Brand Registry program have the ability to create a free, multi-page Amazon Store. This format can get products in front of more people and tell compelling stories about the brand behind them.

Amazon Vendor

An Amazon Vendor has one of the titles of manufacturer/distributor/supplier and is the person or entity responsible for transporting your products to multiple Amazon warehouse locations.

Amazon’s Choice

Amazon’s Choice is a seal featured by Amazon and represents very well-rated, immediately available products at an attractive price.

ASIN

The Amazon Standard Identification Number ( ASIN ) is a ten-digit alphanumeric product identification number. Unlike the ISBN, it does not represent an international standard.

Attribution

Attribution refers to which advertisement was responsible for informing that purchase. Different services have different attribution models.

Automatic Campaigns (Amazon)

Amazon uses specific, context-based targeting of keywords to generate the best results from your ads. Amazon uses natural keyword searches by browsing to find similar products to yours to ensure that the ads are relevant to the searchers in your specific market.

Bid adjustments

Percentage based adjustments to a bid on an ad

Budget

The amount of money that you will target to spend on your advertising campaign.

Buy Box

A box on the product detail page (PDP) allows customers to begin purchasing by adding the product to their cart. A qualifier for Sponsored Products ads eligibility.

Campaign

A structural element of an advertising platform account that groups multiple ad groups.

Campaigns

Structural elements of an advertising platform account which group multiple ad groups.

Click

A click on an ad

Click-through rate (CTR)

The percentage of ad impressions that are clicked as compared to the entire number of clicks. The standard calculation for CTR is (clicks/impressions) x 100.

Clicks

Number of clicks on an ad

Close Match

Your products are displayed to buyers who use search terms closely matched with your products.

For example:

Complements

Complements are targeted buyers who view the detailed pages of products that complement your product. 

Consumer purchase journey/consumer decision journey

Consumer purchase journey is the terminology used to describe the overall relationship between a consumer/client and a particular product, firm, or business. Basically, the model tries to address the need of a brand by ensuring that all the different stages of the purchase journey of a client/customer are appropriately complemented by one another.

Conversion delay

Conversion delay in marketing is when the prospect decides to move on with your offer without any marketing or contact with you whatsoever.

Conversion rate (CR)

The conversion rate in online marketing is the total number of visitors to a website who have made purchases from that site. The concept of conversion rate can be defined by its equation: “Ratio of clicks to conversions.”

Conversion value (CV)

Conversion value is a numeric monetary value that you attribute to a conversion to evaluate its impact on your business. Conversion values help you track and optimize your campaigns’ return on investment (ROI).

Conversions

A customer completes an action; this phrase can be used to refer to any number of actions, including clicking “Add to Basket,” completing a purchase, etc.

Cost of Goods Sold (COGS)

The costs of producing the goods sold by a company. COGS is composed of fixed and variable costs, which in turn have a huge effect on gross profit.

Cost of Good Sold (COGS) meaning

Cost per thousand impressions (CPM)

The average cost that you pay to deliver 1,000 impressions of your ads.

Cost revenue ratio (CRR)

The CRR is the reversed Return of Advertising Spend (ROAS). Its equation can define the concept of conversion revenue ratio: Cost revenue ratio = cost ÷ revenue.

Cost-per-click (CPC)

The concept of conversion rate can be defined by its equation: “Ratio of clicks to conversions.”

Dashboard

Adspert Dashboard is the user interface to manage your ads performance, set performance goals, download reports, observe scenarios.

Demand-side platform, or DSP

The software that is used to access and decide against digital advertising inventory. The solution for Amazon Advertising is Amazon DSP. Amazon DSP offers both self-service and managed options.

Effective CPC (eCPC)

Effective CPC is the conversion of your traffic into paying customers.

Effective Cost Per Click (eCPC) meaning

Impressions

The number of times that an ad was rendered on a page or device.

Key figure

A key performance indicator, otherwise known as KPI, is a numerical value that summarizes a company’s operational effectiveness and performance or a key performance indicator but does not provide information about actual performance. Businesses usually measure progress towards specific business outcomes through measuring key performance indicators. These indicators are normally based on statistical measures, such as the average price and sale volume over time, profit margin, and various other easily determined and collated indicators.

Keywords

Keywords are used to target your ads to relevant shopping queries. You may select the keywords that you’d like to target using manual targeting or let Amazon select the keywords using automatic targeting.

Loose Match

This option allows your ad to be shown in search results if your ad product slightly matches buyers’ search results.

For example; You sell “Song Cover Glass for Partner, Friend, Family.” You may appear on Valentine’s Day search result like below.

Loose Match meaning

Manager account

An ad platform manager account that has access to multiple actual ad accounts

Manual Campaigns

With manual campaigns, the seller chooses the keywords to be targeted in the ads. There are a couple of options for targeting these keywords – which are called the Match Types on Amazon. The match types map the instances for which the ad is shown, allowing you to restrict ads only for the best buyer audience.

New-to-brand metrics

New-to-brand metrics describe customers purchasing your brand/product for the first time on Amazon over the past year. These metrics give advertisers the tools to estimate the cost of engaging new customers on Amazon and identify the most efficient channels and tactics to achieve their campaign goals.

Performance

Advertising performance

Performance group

Group of ad accounts or campaigns with a common performance goal

PerformanceInsider

Performance Insider is a free PPC grade tool that helps you minimize effort by analyzing your advertising accounts and coming up with action suggestions for optimizing your results.

PerformanceInsider meaning

Product Display Ads

Amazon Product Displays Ads are CPC ads that target specific shoppers, interests, and even competitors’ products. These ads are relevant to buyers looking for specific product pages instead of those scrolling search results on Amazon.

Product Display Ads meaning

Product Profit Maximization

Optimization working towards maximizing product-level profitability. Advanced setup needed (full product feed). You can follow this article to understand why Profit is the new ACoS.

Profit Maximization (Autopilot) meaning

Product target

A targeting criterion for products

Product targets

Targeting criteria for products

Profit

Profit (Net income) is an entity’s income minus the cost of goods sold, expenses, depreciation and amortization, interest, and taxes for an accounting period.

Profit Maximization by Adspert (Autopilot)

Adspert optimization working towards maximizing your advertising campaigns’ gross profitability.

Profit optimization

Conversion values are all profit, i.e., prices of the products – costs. Specific goal-types are recommended- cost per month, profit maximization, cost/conv, ROI.

Programmatic

Programmatic is also known as pay-per-click advertising, online advertising, or bidding advertising. The buyer can control the amount they are willing to spend on a particular advertisement.

Promotion

A short period of boosted advertising

Return on ad spend (ROAS)

Return on ad spend (ROAS) is an internet marketing metric that calculates the monetary value gained for every dollar spent for online advertising. Return on ad spend is usually calculated as a percentage of a company’s total advertising budget. Still, it can also be compared to the cost per action (CPA), which measures how much it costs a company per click-through, divided by the number of impressions, or “brush” or “response” that a company receives from an advertisement.

Return on ad spend (ROAS) meaning

Return on Investment

Return on investments is the ratio between initial investment and net profits earned over time. A high ROI means that the returns favorably match the initial cost, either labor or capital. As such a key performance indicator, ROI is regularly used to assess an individual’s efficiency or assess the optimisation of various investments.

Return on Investment meaning

Revenue

Revenue is the income generated from business activities.

Revenue optimization

Conversion values are all revenue, i.e., prices of the products. Specific goal-types are recommended – cost per month, ACoS/CRR, cost/conv, ROAS (coming soon!)

Sales

Sales are activities associated with exchanging goods or the total volume of products sold within a specified target period in a market.

Seller Central

Product name from Amazon for a service where used by sellers on Amazon. The basic difference between Seller Central and Vendor Central is whose job it is to sell your items. With Vendor Central, Amazon’s retail department buys and sells your items to their online customers. With Seller Central, instead, you’re selling directly from Amazon’s web customers.

Stock Keeping Unit (SKU)

In the area of inventory control, an SKU is a unique kind of item for sale, like a widget, a service, or a commodity, and all features related to the product type to distinguish it from all other product types. A typical set includes a description of the product, quantity, manufacturer, and distributor of the product, a description of the method of distribution of the product, the regulatory standards applicable to the product, and a list of authorized sellers of the product.

Stock Keeping Unit (SKU) meaning

Sponsored Brands

In essence, Amazon Sponsored Brands is a way for retailers to increase their advertising revenue by placing their own ads on websites visited by their customers. In most cases, these ads show up at the very top of the page when a consumer searches for a specific topic, making them highly effective for reaching potential customers.

Sponsored Products

Amazon Sponsored Products are the product or keyword-targeted advertisements used to advertise other person’s products. Usually, they appear like organic search results and connect directly to the specific product detail page. These ads generate high-quality clicks and yield a much higher ROI than many other pay-per-click (PPC) programs.

Stock Keeping Unit (SKU) meaning

Substitutes

Substitutes are targeted buyers who view the detail pages of products that substitutes your product. A different brand often sells the same type of product (e.g., Miele refrigerator instead of Samsung).

For example; You sell Puma runner shoes.

Substitutes meaning

Total Advertising Cost of Sale (TACoS)

TACoS measures your advertised spend per click relative to the total revenue earned. So if you advertise a $100 sale on Amazon, and you advertise three times per month, and your cost per click is five cents, then you would be charged the amount of five cents for each of your three advertisements. Your advertised spend per click is relative to the total revenue you earn, not the amount of sales.

Total Advertising Cost of Sale (TACoS) meaning

Usage report

A report with details about Adspert usage with regard to invoicing