MfG, ROI or CTA - Which marketing abbreviations you should know
The ROI challenge
Many marketing experts criticize the term “ROI”, for example. To this day, however, it remains in the vocabulary of CFOs and CMOs. (And two acronyms again ...) Because it is important for companies to know how their investments are paying off. The days when advertising campaigns were carried out for their own sake, 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 advertisement has influenced the willingness to spend more on a product or service. However, this is an important effect that advertising can achieve.
Good campaigns that are played out over a long period of time allow companies to charge higher prices - and a price increase of just one percent is estimated to increase profits by up to eight percent!
A simple solution: no longer leave the term ROI alone! A simple clarification with an addition such as “conservative estimate of” or a temporal supplement with the addition of “long-term” or “short-term” would contextualize the meaningfulness of ROI.
A good CPA is the solution - right?
Another important figure in marketing is the term CPA, the cost per acquisition. This refers to nothing other than the monetary value used to acquire a new customer. Large advertising platforms such as Google show this value.
The only problem with this is that we have no way of knowing whether a person has actually been prompted to make a purchase by the ad or whether he or she has already made the purchase decision in advance, regardless of the campaign's appeal.
CPA is therefore misleading. Companies can be tempted to invest too much money in advertisements, even though the success suggested by a positive CPA value was not triggered by the campaign. In this case, this fixed marketing figure primarily benefits the advertising platforms and not the company's objectives. After all, they hardly benefit from advertisements if they are already generating extensive business through awareness of their brand or products.
The prerequisite for this is the development of a company's own brand identity. Evernine supports companies in this process and in this article we show why redesigning 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 costs that an advertiser has to pay per click on an ad that is placed on a website, search engine or other platform.
CPC is a common billing method in pay-per-click advertising (PPC), where the advertiser only pays when a user actually clicks on the ad and is therefore redirected to the advertiser's website.
The importance of CPC in marketing lies in the fact that it offers a way of evaluating the efficiency of an ad and controlling the reach of a campaign. With CPC, the advertiser can track the number of actual clicks on their 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 group.
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