7 Simple Advertising Terms Every Food Blogger Should Understand

Let’s face it — advertising terms can be confusing. But if you’re looking to turn your food blog into your career (or a money-making side hustle) then it’s important that you have a solid understanding of advertising terminology.

The good news is that the most common advertising terms are fairly simple to figure out, especially if you have examples to reference. In this post we’re going to look at seven different advertising terms every food blogger should understand and explain them using simple and easy to understand examples. The advertising terms we’ll be breaking down are:

Impression
Fill rate
CPM
CPC
CTR
CPA
RPM

Throughout this post we’ll be using a fictitious food blog called Yum Yum Tummy. Here are the stats for this fictitious food blog:

Page views: 1,000
Number of ads: 3
Number of ads that have been clicked: 5
Number of products purchased: 1

Let’s dive into some advertising term definitions!

1. Impression

Impression: Anytime an individual ad is displayed to a visitor on your website.

With our example food blog, Yum Yum Tummy, we have 3 total ad units on display. If a visitor came and looked at a single page on our blog it could potentially result in 3 impressions.

We could also say that the 1,000 page views we have on our blog could potentially result in 3,000 impressions.

1,000 page views x 3 ad units = 3,000 potential impressions

I say potentially because we have to factor in the ad network’s fill rate. ⬇️

2. Fill Rate

Fill Rate: The number of times an ad is displayed divided by the number of times an ad could be displayed.

Here’s how that works with our example blog. As we talked about before, we have 1,000 page views and 3 ads on our website. That means we have the potential for 3,000 impressions.

However, it’s very rare for an ad network to have a 100% fill rate.

Let’s pretend we’re working with a fictitious ad network called Fooder Inc. We know that Fooder Inc. has a fill rate of 60% this month. Using our stats and this fill rate we can assume that we’ll have around 1,800 impressions.

(1,000 page views x 3 ads) x .60 (60% fill rate) = 1,800 impressions)

That means we have 1,200 possible impressions that won’t be filled. What happens to this remnant space? It depends on the ad network.

Some ad networks show very low earning ads while others show public service ads (PSAs) for organizations like Charity Water or the American Cancer Society. Your ad network should have no issue with telling you what they do with remnant space, so be sure to contact them if you’re not sure what’s currently happening with your ad units.

3. CPM

CPM: Cost per 1000 impressions.

Before we jump into the details of CPC, we should mention that there are two different types of ad networks: CPC-based or CPM-based. More on CPC below! So how much can our blog earn from those 1,800 impressions? If we’re using a CPM based ad network then we need to know what the CPM rate is to figure out how much income our blog will earn.

Let’s continue to use Fooder Inc. as our imaginary CPM based ad network. Last month the CPM for Fooder Inc. averaged out to $2. That means our 1,800 impressions will earn us a total of $3.60.

1.8 (thousand impressions) x $2 CPM = $3.60 income

A few important things to know about CPM advertising:

There are peaks and valleys in the advertising cycle. The beginning of the year typically has lower numbers and the end of the year typically has higher numbers.
Ad networks will sometimes provide a higher CPM number that represents the total CPM that they’re getting from the advertiser. Make sure you understand what your cut of that CPM number is. For instance, if an ad network says they get a $6 CPM, but your cut is 50%, then you’re actual CPM is $3.
Always remember to factor in the fill rate. A $5 CPM isn’t that great if the fill rate is only 10%.

The key to increasing your income with CPM based advertising is (1) increasing your traffic and (2) finding the ad network with the highest CPMs.

4. CPC

CPC: Cost per click.

When learning about CPM we pretended that we were working with a CPM advertiser. We’re now going to pretend that we’re working with a fictitious CPC advertiser called Clickster Inc.

So how much can our blog earn from those 1,800 impressions if we’re using Clickster Inc. as our advertiser? It depends on how many people end up clicking on an ad.

Our 1,800 impressions could make us zero dollars if we’re using a CPC advertisers and no one clicks on an ad. We could even have 1,800,000 impressions and still not make anything if we don’t have anyone clicking on the ad.

CPC is all about the click. The more clicks you get the more potential income you can make from your blog.

In our example stats we had 1,000 page views, 3 ad units, and 5 total ads clicked. Let’s pretend the CPC rate for those ads is $1. That would mean that we would earn a total of $5.

5 ads clicked x $1 CPC = $5 income

The key to increasing your income with CPC based advertising is to get more people to click on your ads. The issue with this is that the best way to increase clicks is to place ads in places where people are more likely to see them, like in the middle of your blog post. This creates a poor user experience for your readers.

A few important things to know about CPC advertising:

Never try and earn a quick buck by clicking on your own ad. The ad networks are smart and it’s almost guaranteed they’ll catch invalid clicks.
Most CPC ad networks don’t have stringent rules requiring ads to be placed above the fold. Try experimenting with CPC ads in places where CPM ads might not be able to be placed, like at the bottom of a sidebar or above the comments section of a post.
Some CPM networks will let you use ad networks like Google AdSense to backfill any impressions that the CPM network doesn’t fill. Make sure you continue to follow the CPC rules for these type of situations.

5. CPA

CPA: Cost per acquisition.

Cost per acquisition is a type of advertising where you (the creator) are paid when a visitor clicks on an ad and purchases (or signs up) for a product. A common type of CPA advertising is affiliate marketing. With affiliate marketing you’re only paid if someone ends up purchasing the product that was advertised.

If we look at our Yum Yum Tummy stats we know that we had 1,800 impressions, 5 clicks, and 1 product purchased. If our ads were CPA based ads then the only stat that matters is how many products were purchased.

Let’s pretend that the ads we were running were for the BlendTec affiliate program. BlendTec pays a 15% commission rate. Let’s pretend the product that was purchased was a $500 blender. We would end up earning a total of $75.

0.15 (15% CPA commission) x $500 price of product = $75 income

It might be easy to see that number and think that you should just switch all your ads to CPA ads because the payout is higher. However, the reality is that affiliate marketing isn’t as easy at it seems. You have to have a good understanding of the process and make sure that you’re using affiliate links in the right place throughout your blog.

6. CTR

CTR: Click through rate.

Click through rate can be found by taking the number of clicks divided by the number of page views. It’s an important concept to understand because it’s used a lot in internet marketing, so make sure you take your time with this one.

Nerd Note: It’s also possible to calculate CTR by taking the number of clicks divided by the number of impressions, but in this example we’ll be using page views.

We know that Yum Yum Tummy had 5 clicks on 1,000 page views, so our CTR would be 0.005%.

5 clicks / 1,000 page views = 0.005% CTR

With CPC and CPA based advertising one of the ways to increase your income is by finding ways to increase your CTR. One of the most common ways to increase CTR is by performing split testing. We won’t go over that right now, but it’s definitely something you should look into if you’re serious about monetizing your food blog.

7. RPM

RPM: Page revenue per thousand impressions.

RPM shows you how much you make from every 1,000 page views on your blog. It’s commonly used to measure the performance of your ads, but I like to use it to measure the overall effectiveness of a site’s income generation. The equation looks like this:

(Total revenue / Number of page views) * 1000 = Page RPM

Let’s move away from our example food blog and use Pinch of Yum’s traffic and revenue from way back in the November 2013 Traffic and Income Report and the December 2013 Traffic and Income Report.

November

Revenue: $15,363.75
Page views: 1,428,175
RPM: $10.76

($15,363.75 revenue / 1,428,175 page views) * 1,000 = $10.76 RPM

December

Revenue: $19,829.98
Page views: 1,294,900
RPM: $15.31

($19,829.98 revenue / 1,294,900 page views) * 1,000 = $15.31 RPM

Wow! The RPM is drastically different.

December was a much better month compared to November. When looking at these numbers we can see that in December we earned almost $5 more for everyone 1,000 page views when compared to November.

Increasing your blog’s overall RPM is one of the most important things you can do to increase your income as a food blogger.

And the best part about RPM is that you don’t have to increase your blog’s traffic in order to increase your RPM. That being said, RPMs are, in large part, out of your control. Raptive has a great post about what goes into RPMs, but it basically boils down to the value of each individual visitor to your site, the layout of your ads, and the blog content on that page.

So how exactly do you go about increasing your blog’s RPM? Mediavine has a really thorough guide to improving RPMs, but many of the suggestions are the same as you’d find when looking for general best practices for SEO and optimizing user experience on your site (i.e. improving site speed, creating high-quality content, etc.). RPMs also tend to fluctuate with the seasons, so prioritizing updating, publishing, and sharing holiday content in Q4 is always a smart RPM strategy.

If you ever have any questions about increasing your RPMs — ask your ad network! They’re usually really happy to help and point you in the right direction. This is also a great opportunity to do some digging yourself — which of your posts tend to perform the best when it comes to RPMs? What makes them different from other posts? Replicate that!

There you have it: impression, fill rate, CPM, CPC, CTR, CPA, and RPM. Seven simple advertising terms that will help you leverage the earning potential of your food blog.