GLOSSARY
Your comprehensive guide to marketing analytics terminology. From attribution models to ROI metrics, understand the language of data-driven marketing.
A/B Testing
A method of comparing two versions of a marketing asset to determine which performs better based on statistical analysis.
Adstock
The prolonged or lagged effect of advertising on consumer behavior, representing how advertising impact decays over time after exposure.
Affiliate Marketing
A performance-based marketing system where partners (affiliates) are rewarded for each visitor or customer brought through their marketing efforts.
Attribution Model
A framework that assigns credit for sales and conversions to different touchpoints in a customer's purchase journey, providing insights into channel effectiveness.
Average Order Value (AOV)
The average amount spent each time a customer places an order, calculated by dividing total revenue by the number of orders.
Baseline Sales
The level of sales that would occur without any marketing activity, representing organic demand driven by brand equity and market factors.
Bayesian Inference
A statistical method used in MMM that combines prior knowledge with observed data to make probabilistic predictions about marketing effectiveness.
Brand Lift
The increase in brand awareness, perception, or purchase intent resulting from advertising exposure, often measured through surveys.
Budget Allocation
The process of distributing marketing spend across different channels, campaigns, or time periods to maximize overall return on investment.
Carryover Effect
The continued impact of advertising after the campaign ends, where previous marketing investments continue to influence current sales.
Channel Attribution
The process of determining which marketing channels contributed to conversions and to what degree each channel influenced the customer journey.
Click-Through Rate (CTR)
The percentage of people who click on a link or advertisement after seeing it, calculated by dividing clicks by impressions.
Conversion Funnel
A visual representation of a customer's journey through stages from initial awareness to final purchase, used to identify drop-off points.
Conversion Rate
The percentage of visitors who complete a desired action, such as making a purchase or signing up for a newsletter.
Cost Per Acquisition (CPA)
The total cost of acquiring a new customer, calculated by dividing total marketing spend by the number of new customers acquired.
Customer Lifetime Value (CLV)
The predicted total revenue a business can expect from a single customer account throughout their entire relationship.
Data-Driven Attribution
An attribution model that uses machine learning to analyze conversion paths and assign credit based on actual data patterns rather than predefined rules.
Decay Rate
The rate at which the effect of advertising diminishes over time, used in adstock calculations to model how quickly marketing impact fades.
Diminishing Returns
The principle that additional marketing investment produces progressively smaller increases in response, leading to saturation effects.
Econometrics
The application of statistical and mathematical methods to economic data, used in marketing to measure relationships between variables and predict outcomes.
Elasticity
A measure of how sensitive sales are to changes in marketing spend or price, indicating the percentage change in demand for a percentage change in investment.
First-Touch Attribution
An attribution model that assigns 100% credit for a conversion to the first marketing touchpoint a customer encountered.
Frequency
The average number of times an individual is exposed to an advertisement within a specific time period.
Geo-Lift Testing
A quasi-experimental method that compares marketing performance across different geographic regions to measure incremental impact.
Gross Rating Points (GRP)
A measure of advertising exposure, calculated by multiplying reach by frequency, representing total impressions as a percentage of target audience.
Holdout Testing
An experimental approach where a portion of the audience is deliberately excluded from marketing exposure to measure incremental impact.
Halo Effect
The positive spillover impact that advertising for one product or channel has on sales of related products or through other channels.
Incrementality
The additional conversions or revenue directly attributable to marketing efforts that would not have occurred organically without the marketing activity.
Impression
A single instance of an advertisement being displayed to a user, counted each time an ad is shown regardless of interaction.
Last-Touch Attribution
An attribution model that assigns 100% credit for a conversion to the final marketing touchpoint before purchase.
Linear Attribution
An attribution model that distributes credit equally across all touchpoints in the customer journey leading to conversion.
Marketing Mix Modeling (MMM)
A statistical analysis technique that quantifies the impact of various marketing activities on sales to optimize future budget allocation.
Media Mix
The combination of marketing channels and platforms used in an advertising campaign, including TV, digital, print, and social media.
Multi-Touch Attribution (MTA)
An attribution approach that assigns fractional credit to multiple touchpoints along the customer journey based on their relative influence.
Omnichannel Marketing
A customer-centric approach that provides a seamless experience across all marketing channels and touchpoints.
Price Elasticity
A measure of how sensitive customer demand is to changes in price, indicating the percentage change in quantity demanded for a percentage change in price.
Programmatic Advertising
Automated buying and selling of digital advertising using algorithms and real-time bidding to target specific audiences.
Reach
The total number or percentage of unique individuals exposed to an advertisement within a specific time period.
Response Curve
A graphical representation showing the relationship between marketing investment and response, typically illustrating diminishing returns at higher spend levels.
Return on Ad Spend (ROAS)
A marketing metric that measures revenue generated for every dollar spent on advertising, calculated by dividing revenue by ad spend.
Return on Investment (ROI)
A performance measure that calculates the profitability of an investment, expressed as the ratio of net profit to cost.
Saturation Point
The level of marketing investment beyond which additional spending produces negligible incremental returns due to market saturation.
Seasonality
Predictable patterns in sales or marketing performance that recur regularly based on time of year, holidays, or other cyclical factors.
Share of Voice (SOV)
A brand's portion of total advertising within a market or category, often used as a predictor of market share.
Synergy Effect
The combined impact of using multiple marketing channels together that exceeds the sum of their individual effects.
Time-Decay Attribution
An attribution model that assigns more credit to touchpoints closer in time to the conversion, with earlier touchpoints receiving less weight.
Touchpoint
Any interaction between a customer and a brand throughout the customer journey, including ads, emails, website visits, and purchases.
Uplift Modeling
A predictive modeling technique that estimates the incremental impact of a marketing action on individual customer behavior.
Wearout
The decline in advertising effectiveness over time as audiences become overexposed to the same creative content.