Marketing teams rely on commonly understood terms to plan campaigns, analyze performance, and communicate results clearly. Without that shared vocabulary, miscommunication can occur, and even strong ideas can be misunderstood or fall flat.

This guide is a practical resource for adults building or advancing marketing careers through online education. Whether you’re considering a career in marketing, have a marketing degree underway, or are already working in the field, understanding core digital marketing terminology is essential. 

Below, you’ll find clear definitions of common digital marketing terms and acronyms. Mastering these marketing industry terms can help you think strategically, make data-driven decisions, and contribute confidently to campaigns. 

1. A/B Testing

A/B testing is one of the most important tools used in digital marketing today. It replaces guesswork with evidence by comparing two variations—such as email subject lines or landing page layouts—to determine which option performs better with your target audience. 

Marketers use A/B testing to optimize campaigns and test products. Examples of A/B testing include:

• Testing two CTA button colors to see which generates more clicks
• Comparing two email subject lines to improve open rates
• Evaluating different landing pages to increase conversions

A/B testing supports continuous improvement in both marketing and product design, helping teams refine elements based on user behaviors. Creating a detailed buyer persona helps marketers design A/B tests, CTAs, and campaigns that resonate with the intended audience.

2. SEO (Search Engine Optimization) 

Search engine optimization is a foundational digital marketing practice that focuses on improving a website’s visibility in organic search engine results. By aligning content with search intent and best practices, SEO helps businesses attract qualified audiences without relying solely on paid advertising. 

Core SEO tactics include:

• Keyword research to understand what audiences are searching for
• On-page optimization, such as title tags and meta descriptions
• Link building to establish authority and credibility

SEO is a cost-effective digital marketing tactic because it continues delivering traffic and value over time, beyond the initial investment. 

3. PPC (Pay-Per-Click) and CPC (Cost Per Click) 

Paid digital advertising allows marketers to drive traffic while managing ad spend and performance. By using defined pricing models, marketers can scale campaigns and measure results in real time. 

• Pay-Per-Click (PPC) is a digital advertising model where advertisers pay each time a user clicks their ad. When someone clicks on an ad shown on platforms like Google, Amazon, or Facebook, for example, the advertiser pays for that interaction.
• Cost Per Click (CPC) specifies the price paid for each individual ad click within a PPC campaign. This helps marketers manage budgets and compare performance across platforms.

While PPC and CPC focus on clicks, related pricing models such as cost per acquisition (CPA) and cost per lead (CPL) measure the cost of completed actions, rather than traffic alone.

Together, these models help marketers evaluate campaign performance and optimize advertising spend.

4. CTA (Call to Action) 

CTAs guide users toward a specific action by clearly showing the next step to take such as Buy Now, Sign Up, or Learn More. They help turn prospects into leads, customers, or subscribers.

Certain types of CTAs are better suited to different media or platforms. For example, email CTAs are benefit-driven, website CTAs are contextual and step-based, and CTAs on ads are urgent or curiosity-driven. 

Examples of effective calls to action include:

• Digital ads: Shop Now for Free Shipping, Get Started Today, Learn More
• Emails: Shop Our New Arrivals, Read the Full Article, Get Your 20% Off Code
• Websites: Add to Cart, Book a Demo, Start Free Trial 

CTA placement and design can also influence conversion rates. Buttons should be prominent, easy to find, and paired with compelling copy to encourage clicks and action.

5. CTR (Click-Through Rate) 

Click-Through Rate (CTR) is a key engagement metric that measures how many times an ad, email, or link is clicked relative to how often it is shown. CTR is calculated by dividing total clicks by total impressions. For example, if an ad receives 50 clicks from 1,000 impressions, the CTR is 5%.

Average click-through rate benchmarks vary by channel:*

• Google search ads: 5.06%
• Email marketing CTRs: 3.75%
• Social media ads: 1%

A strong CTR often indicates effective messaging or audience targeting. While CTR measures engagement, it differs from conversion rate, which tracks how many users complete a desired action after clicking. 

*As reported by Demand Curve

6. Conversion Rate 

Conversion rate is one of the most important performance metrics in digital marketing. It measures campaign and landing page performance, and ties traffic to tangible outcomes. While engagement metrics show interest, conversion rates reveal whether a campaign or landing page is actually driving action. 

Conversion rate is the percentage of visitors who complete a desired action, such as filling out a form, signing up for a service, or making a purchase. 

• Conversion rate formula: Number of conversions ÷ total visitors or interactions x 100

For example, if a landing page receives 1,000 visitors and 50 complete the desired action, the conversion rate is 5%.

Marketers can improve conversion rates by refining key campaign elements, implementing A/B testing, strengthening CTAs, improving page load speed, and simplifying forms.

7. CAC (Customer Acquisition Cost) 

Customer acquisition cost (CAC) is a vital business metric that determines how much a company spends to gain a new customer. It directly impacts marketing return on investment (ROI) by helping companies understand whether their acquisition efforts are cost-effective. 

CAC is calculated by dividing total marketing and sales costs by the number of new customers acquired in a specific time period. 

• CAC formula: Total marketing and sales costs ÷ new customers acquired

For example, if a company spends $10,000 on marketing and sales in one month and acquires 100 new customers, the CAC is $100 per customer. 

Keeping CAC lower than Lifetime Value (LTV)—the total revenue a customer is expected to generate over time—is essential for long-term profitability. 

8. LTV and ARPU (Lifetime Value and Average Revenue Per User) 

Lifetime Value (LTV) and Average Revenue Per User (ARPU) help marketers understand the long-term value of their customers.

• LTV: Predicts the total net profit a customer will generate over the course of their relationship with a business. 
• ARPU: Measures the average revenue generated per active user during a specific period.

Tracking LTV and ARPU together provides insight into customer behavior, campaign effectiveness, and overall business growth.

Additionally, comparing LTV to Customer Acquisition Cost (CAC) helps businesses see if their marketing efforts are profitable and how quickly acquisition costs are recouped.

9. Churn Rate 

Churn rate is an essential retention metric for subscription and SaaS businesses, showing the percentage of customers who stop using a product or service. Tracking churn helps companies understand retention, spot potential issues, and identify areas for improvement. 

High churn can reduce lifetime value, slow growth, and cut into profitability. It can also lower ARPU, which measures the average revenue each active user generates during a specific period. 

Strategies to reduce churn include:

• Providing a strong onboarding experience for customers
• Running engagement campaigns to keep users active and informed
• Offering personalized support and proactive communication
• Using customer relationship management (CRM) tools to track interactions and monitor retention 

By actively monitoring churn rate, businesses can apply effective strategies to retain more customers and strengthen long-term growth. 

10. KPI (Key Performance Indicator) 

Key performance indicators (KPIs) help marketers set goals and measure performance across marketing activities. It’s a quantifiable metric used to gauge progress toward specific business or marketing goals.

Common marketing KPIs by campaign type include:

• Lead generation: Conversion rate and cost per lead (CPL) measure how effectively campaigns turn interest into qualified prospective customers.
• Sales: Customer acquisition cost (CAC), revenue, and return on ad spend (ROAS) help show profitability and sales performance.
• Brand awareness: Impressions, reach, and engagement rate indicate how widely content marketing reaches and how audiences interact with it. 

Tracking KPIs through regular reporting and analysis allows marketers to evaluate performance over time, identify trends, and adjust strategies to improve results. Using a KPT (Key Performance Tracker) can help teams monitor progress and adjust campaigns in real time.

11. Attribution 

Attribution shows which marketing efforts drive results and actually lead to conversions. Understanding attribution helps marketers see which campaigns, channels, or tactics are most effective. 

Common attribution models include:

• First-touch: Gives all credit to the first interaction a customer has with your brand. 
• Last-touch: Gives all credit to the final interaction before conversion.
• Multi-touch: Distributes credit across multiple touchpoints for a more complete view of performance. 

Tracking attribution allows marketers to optimize campaigns, allocate budgets better, and avoid overvaluing or undervaluing certain channels or efforts. 

12. Retargeting

Retargeting is a digital advertising strategy used to reconnect with people who previously visited a website, app, or landing page. It encourages interested users to return and convert by completing a desired action, like making a purchase. 

Retargeting works by using cookies to group visitors into audience segments based on actions they’ve taken, such as viewing a page or leaving items in a cart. They are then shown relevant ads to bring them back. Personal information is not collected. 

Best practices for retargeting include:

• Setting frequency limits so ads aren’t shown too often
• Showing personalized ads based on past behavior
• Removing users who have already converted

Retargeting helps improve conversion rates by focusing ad spend on potential customers who have already shown interest in a product or service. 

13. Open Rate 

Open rate measures how many recipients open a company’s emails. It’s an indicator of how well your subject line reflects audience interest. 

• Open rate formula: Emails opened ÷ emails delivered x 100

Average open rates are around 20 to 25%, although this can vary by industry, sector, and target audience. For example, nonprofits, health and fitness, and education open rates tend to be higher than retail and manufacturing. 

Ways to improve open rates include:

• Testing different subject lines to see which gets more opens
• Using a recognizable sender name that builds trust
• Sending emails at optimal times when recipients are most likely to check their inbox

Monitoring open rates helps marketers refine email campaigns and improve overall engagement. 

14. Email Deliverability 

Email deliverability measures the percentage of sent emails that reach your intended recipients’ inboxes. Deliverability is essential for engagement and campaign success.

Common issues with email deliverability include inactive or invalid email addresses, spam filters, and poor authentication. Deliverability can also be affected by sender reputation and list hygiene, which means keeping your subscriber list clean and up to date. 

Best practices for email deliverability include:

• Authenticating your domain
• Cleaning up email lists regularly
• Monitoring bounce rate and engagement

Following these best practices helps email open rate, improving engagement and overall campaign results. 

15. Engagement 

Engagement measures how audiences interact with your content across digital channels. It shows interest, relevance, and how well your marketing resonates with users through actions such as likes, comments, shares, clicks, and time spent on a page. 

Types of engagement metrics by channel include:

• Social media: Likes, shares, comments, saves, and video views
• Websites: Page views, time on site, and click-throughs
• Email: Clicks, replies, and forwards

Industry benchmarks as reported by Databox show that engagement varies by sector. For example, e-commerce and marketplaces have an average engagement rate of 63.86% compared to 58.1% for education, 59.15% for healthcare, and 54.44% for technology.

Tracking engagement over time helps marketers identify what content resonates, optimize campaigns, and improve audience connection across platforms. Content marketing is a key driver of engagement, helping brands attract, educate, and retain audiences across digital channels.

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Whether you’re just starting out, upskilling, or advancing your career, WGU offers online degrees for every stage. The Digital Marketing Fundamentals certificate is ideal for foundational skills and building a professional portfolio. The B.S. in Marketing prepares you for real-world marketing roles, and the M.S. in Digital Marketing takes your expertise to the next level, with two tracks: digital marketing or marketing analytics. All coursework is online and competency-based, so you can earn your degree around your schedule. 

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Frequently Asked Questions 

What is the difference between CTR and conversion rate? 

Click-through rate (CTR) measures how many people click on your ad, email, or link compared to how many saw it. Conversion rate measures how many of those users complete a desired action like making a purchase, filling out a form, or signing up for a product or service. 

How do CAC and LTV help measure marketing success? 

Customer acquisition cost (CAC) shows how much it costs to gain a new customer, while Lifetime Value (LTV) estimates the total revenue a customer will generate over time. Comparing CAC and LTV helps marketers assess campaign profitability and long-term business growth. 

Why is SEO important for online marketing? 

SEO helps increase a website’s visibility in search engines, driving free, targeted web traffic. It also helps build a brand's authority and credibility, and helps attract the right audience over time—making it essential for sustained digital marketing success. Inbound marketing strategies like SEO draw potential customers to your brand rather than relying solely on paid ads.

What role does a CTA play in digital campaigns? 

A CTA, or call to action, tells users exactly what step to take next, like signing up, downloading, or making a purchase. It helps turn prospects into leads or customers, making it a key part of digital campaigns. 

How can retargeting improve customer conversion rates? 

Retargeting shows ads to people who have already visited your website or app. It reminds them about your product or offer, increasing the chances that they return to complete a purchase or other desired action.