MfG, ROI or CTA – Which Marketing Acronyms You Should Know
Marketing acronyms can often be misleading. But as marketers, we rely on them to make statements about the impact of campaigns and measures. But there are more and more… The Evernine uses small examples to show which terms are particularly important in digital campaigns, but also problematic, and which solutions are available to make marketing a success today.
B2B, ROI, CTR, CPA – the world of marketing is full of confusing acronyms. Even long-time professionals in the industry know what they mean, but sometimes don’t understand what’s really behind the terms. However, ROI, return of investment, and CPA, cost per acquisition, in particular, are important metrics; after all, they are necessary to measure effectiveness and the success of campaigns. In our blog post, we want to explain the terminologies on the one hand, and take a much-needed critical look at them on the other.
The challenge of ROI
Many marketing experts criticize the term “ROI”, for example. Yet to this day, it remains in the vocabulary of CFOs and CMOs. (And again, two acronyms …) Because it’s important for companies to know how their investments are paying off. The days when advertising campaigns were run for the sake of it, without having to produce a concrete result, are over due to budget cuts and ever louder calls for more efficiency in marketing.
However, the ROI is by no means clear. It often lacks the right context. For example, ROI says nothing about the extent to which an ad has influenced people’s willingness to spend more on a product or service. However, this is precisely an important effect that advertising can achieve.
Good campaigns played out over a long time allow companies to charge higher prices – and a price increase of just one percent increases profits by up to eight percent, according to estimates!
A simple solution: no longer let the term ROI stand alone! A simple specification by an addition like “conservative estimate of” or a temporal addition by the addition of “long term” or “short term” would contextualize the meaningfulness of ROI.
A good CPA is the solution – right?
Another important parameter in marketing is the term CPA, cost per acquisition. This means nothing more than the monetary value that has been used to acquire a new customer. Large advertising platforms such as Google show this value.
The only problem with this is that we cannot know whether a person has actually been prompted to make a purchase by the ad, or whether he or she has not already made the decision to buy in advance, independently of being addressed by the campaign.
CPA is therefore misleading. Companies can be misled into spending too much money on advertising, even though the success suggested by a positive CPA value was not triggered by the campaign at all. Then this fixed marketing figure mainly benefits the advertising platforms and not the companies’ goals. After all, they hardly benefit from ads if they already generate business extensively through awareness of their brand or products.
The prerequisite for this is the establishment of their own brand identity. Evernine supports companies in this process and in this article we show why the redesign in brand building is important right now.
The CPC brings visibility and traffic
The acronym CPC stands for “cost per click” and is another important term in online marketing. It refers to the cost that an advertiser has to pay per click on an ad that is placed on a website, in a search engine or on another platform.
CPC is a common billing method in pay-per-click (PPC) advertising, where the advertiser pays only when a user actually clicks on the ad and is thus redirected to the advertiser’s website.
The important significance of CPC in marketing is that it provides a way to evaluate the efficiency of an ad and control the reach of a campaign. With CPC, the advertiser can track the number of actual clicks on his ads and calculate the cost per click.
This makes it possible to control the budget more effectively and ensure that the ad reaches the target audience.
Exploiting the full potential with connected marketing
However, companies have simply become accustomed to the fact that they can constantly acquire new customers through a low CPC and CPA, without questioning whether there is a causal relationship here at all. It is therefore important to distinguish between “sales-that-follow-a-click” and “sales-caused-by-the-click”!
How can this be achieved? By marketers not only looking at the CPA, but also including other data in the context – such as the CPC, the increased reach in the target group and, in the end, the actual conversion of leads into new customers! This requires smooth collaboration between all departments, in this case of course Marketing and Sales. The goal is to optimize communication between the individual players in order to achieve greater efficiency and reduce costs overall.
With the Connected Marketing model, Evernine has put this strategy into practice. As a communications consultancy and full-service agency, we are able to accompany our clients on their journey into the digital future of communications with “One Voice”. And in our campaigns, only the acronyms that actually make a contextual statement are important. For more information, check out this post and our Quick Guide!
CTA, CPM and ROI
B2B, B2C and KPI
SEM, UGC and SEO
MQL, SQL – we know them now.
MfG – “mit freundlichen Grüßen”, now we also have an overview like the Fantastischen Vier in their hit.
Source title image: Evernine Group.