Marketing & AEO Glossary

Advantage+ Shopping Campaigns (ASC) are Meta's AI-driven campaign type that automates audience selection, placements, and creative combinations for e-commerce advertisers. By minimizing manual targeting, ASC lets Meta's algorithm find buyers across Facebook and Instagram, often improving efficiency at scale — though it works best with strong creative and clean conversion tracking.

AEO, or Answer Engine Optimization, is the practice of structuring content so AI answer engines — Google AI Overviews, ChatGPT, Perplexity, and Gemini — cite it when responding to questions. It emphasizes direct answers near the top of the page, clear headings, structured data, and factual, self-contained statements a model can quote.

Agentic AI refers to AI systems that can take actions autonomously to achieve a goal — planning steps, using tools, and making decisions — rather than only generating text in response to a prompt. In commerce, agentic AI powers assistants that browse, compare, and complete purchases on a shopper's behalf.

AOV, or Average Order Value, is total revenue divided by number of orders over a period. It shows how much customers spend per transaction. Raising AOV through bundling, upsells, and free-shipping thresholds improves ROAS and unit economics without needing more traffic, because each order carries more revenue against the same acquisition cost.

Attribution is the method of assigning credit for a conversion to the marketing touchpoints that influenced it. Models range from last-click (all credit to the final touch) to data-driven multi-touch. Attribution shapes budget decisions, but every model has bias, which is why brands supplement it with blended metrics like MER and incrementality tests.

Break-even ROAS is the return on ad spend at which advertising revenue exactly covers product cost plus ad cost, leaving zero profit. It equals 1 divided by your gross margin. A brand with a 40% gross margin has a break-even ROAS of 2.5x; anything above that is profit.

CAC, or Customer Acquisition Cost, is the total sales and marketing spend required to acquire one new customer, calculated as total acquisition cost divided by new customers acquired. A lower CAC relative to customer lifetime value (LTV) indicates efficient, scalable growth. Most brands target an LTV:CAC ratio of at least 3:1.

Conversion rate is the percentage of visitors who complete a desired action — a purchase, lead, or signup — calculated as (conversions ÷ visitors) × 100. For Indian D2C e-commerce, a typical site converts 1-3% of visitors. Improving conversion rate lifts revenue from existing traffic, making it one of the highest-leverage growth levers.

Conversion Rate Optimization (CRO) is the systematic process of increasing the share of visitors who take a desired action, using research, A/B testing, and UX improvements. Rather than buying more traffic, CRO extracts more revenue from existing traffic — improving product pages, checkout flow, page speed, and messaging to remove friction from the buying journey.

CPC, or Cost Per Click, is the amount an advertiser pays each time someone clicks an ad, calculated as total spend divided by clicks. It reflects auction competitiveness and ad relevance. On search, high-intent keywords cost more per click but convert better; on social, strong creative lowers CPC by improving click-through rate.

CPM, or Cost Per Mille, is the cost to show an ad one thousand times, calculated as (cost ÷ impressions) × 1000. It is the standard pricing metric for awareness and reach campaigns on Meta, Google, and programmatic platforms. Lower CPMs mean cheaper reach, but relevance and conversion matter more for performance goals.

First-party data is information a business collects directly from its own customers — purchases, email signups, website behavior, and consented profile data. As third-party cookies disappear, first-party data becomes the foundation for targeting, personalization, and measurement, and it can be shared with ad platforms via secure conversion APIs to improve performance.

Full-funnel marketing coordinates activity across every stage of the customer journey — awareness, consideration, conversion, and retention — instead of optimizing one stage in isolation. It balances brand-building demand generation with performance-driven demand capture, so top-of-funnel investment feeds a steady supply of high-intent buyers for conversion campaigns to close efficiently.

GEO, or Generative Engine Optimization, is optimizing content to be surfaced and cited inside AI-generated answers rather than traditional blue-link results. It overlaps with AEO and SEO but focuses on being the source a large language model draws from — through authority, clear structure, original data, and machine-readable markup that models can extract and attribute.

Incrementality measures the additional conversions caused by advertising that would not have happened otherwise. Because platforms take credit for sales that would have occurred anyway, incrementality testing — using holdout groups or geo experiments — reveals an ad channel's true causal impact, which is often lower than last-click attribution suggests.

LTV, or Customer Lifetime Value, is the total gross profit a business expects from a customer across the entire relationship. It combines average order value, purchase frequency, gross margin, and customer lifespan. Comparing LTV to CAC reveals whether acquisition spending is sustainable — a healthy LTV:CAC ratio is 3:1 or higher.

MER, or Marketing Efficiency Ratio, is total company revenue divided by total marketing spend across all channels. Unlike platform-reported ROAS, MER is a blended, board-level view that avoids double-counting and attribution bias. A rising MER signals marketing is driving efficient overall growth, even when individual channel ROAS figures fluctuate.

Performance Max is a Google Ads campaign type that uses AI to serve ads across Search, Shopping, YouTube, Display, Gmail, and Maps from a single campaign. Advertisers supply assets, audience signals, and a goal, and Google's automation optimizes bidding and placement. It maximizes reach but offers less granular control than manual campaigns.

ROAS, or Return on Ad Spend, is revenue generated divided by advertising cost. If you spend ₹1,00,000 on ads and earn ₹4,00,000 in attributable revenue, your ROAS is 4x. It measures advertising efficiency but ignores product cost and margin, so it is not the same as profit.

A zero-click search is a query answered directly on the results page — via an AI Overview, featured snippet, or knowledge panel — so the user never visits a website. Zero-click searches now make up the majority of Google queries, pushing brands to optimize for citation and visibility rather than clicks alone.