Ad Platform Playbook
Glossary
Definitions for common advertising and business terms used throughout Trellis.
For · Anyone running into an unfamiliar term in a Trellis report or article
Time · 5 min read
Next · Getting Started with Trellis
Start With These Four
Most of the glossary explains itself once these four are clear, because every profitability judgment in an audit is built from them: COGS, Gross Margin, Break-Even CPA, and Break-Even ROAS. Gross margin comes from COGS; the two break-even figures come from gross margin; and every verdict about whether a campaign is worth its spend is a comparison against one of those two lines.
Everything below is alphabetical, so you can also just look up the term that sent you here.
Advertising and Business Terms
| Term | What it means | Why it matters |
|---|---|---|
| AOV (Average Order Value) | Average revenue per order: total revenue divided by total orders | One of the two inputs to break-even CPA, so it sets the ceiling on what a sale can cost |
| Blended Margin | A weighted average gross margin across all products, computed from actual per-SKU COGS data | Represents profitability across your real product mix rather than a single assumed rate |
| Break-Even CPA | The maximum cost per acquisition that produces zero profit: AOV multiplied by gross margin | Spending more than this per sale loses money, whatever the platform reports |
| Break-Even ROAS | The minimum return on ad spend needed to cover COGS: 1 divided by gross margin | Below this line advertising is unprofitable even when revenue is growing |
| CLV (Customer Lifetime Value) | Total revenue expected from a customer across the whole relationship, including repeat purchases | Explains why an acquisition above break-even CPA can still be worth making |
| COGS (Cost of Goods Sold) | The direct cost to produce or purchase each product | The input that turns spend analysis into profitability analysis at the product level |
| Competitor Campaign | A search campaign bidding on a rival brand’s trademark queries. Both Google and Microsoft permit bidding on competitor trademarks as keywords; the restriction is on ad copy, which must not use the rival’s brand name | Trellis recommends keeping it separate from branded and non-branded, with Dynamic Keyword Insertion disabled so ad text cannot insert a competitor’s name |
| Confidence Tier | A rating (Very High, High, Medium, Low, Insufficient) assigned to audit recommendations based on how many conversions are in the data set | Tells you how much weight a recommendation can carry before you act on it |
| CPA (Cost Per Acquisition) | Average advertising cost to generate one conversion: total spend divided by total conversions | The number you compare against break-even CPA to decide whether a campaign earns its place |
| Evergreen Campaign | An always-on campaign built around perennial-search-volume keywords, with no seasonal expiration | Captures broad brand-adjacent intent year-round, distinct from a promotional flight with a sunset date |
| gclid | Google Click Identifier, appended to landing page URLs when someone clicks a Google ad | Used to attribute conversions back to a specific click, and commonly stripped before the order is recorded |
| Gross Margin | Revenue minus cost of goods sold, as a percentage. A 65% margin means $0.65 of every revenue dollar remains after COGS | The other input to break-even, and the reason two accounts with identical CPAs can have opposite verdicts |
| Match Type | The keyword setting controlling which searches trigger your ad: Exact, Phrase, or Broad | Determines how much negative-keyword coverage you need to keep spend on-target |
| Negative Keywords | Words or phrases that prevent your ads from showing on irrelevant searches. Adding “free” stops your ad appearing on “free camping gear reviews” | The main lever for containing broad match. Coverage should scale with how broad your match types are |
| PMax (Performance Max) | A Google Ads campaign type serving across all Google channels (Search, Display, YouTube, Gmail, Maps) from a single campaign | Trades query-level visibility for reach, which changes what an audit can diagnose about it |
| Quality Score | In Trellis, a 0-100 rating of audit report reliability across seven dimensions (data accuracy, analytical depth, recommendation quality, structure, estimation compliance, cross-validation, CLI annotations). In Google Ads, a 1-10 rating of keyword relevance | Two different numbers with the same name. Check which system a Quality Score came from before comparing it to anything |
| ROAS (Return on Ad Spend) | Revenue per dollar of advertising spent. A 3.0x ROAS means $3 in revenue for every $1 spent | A revenue measure, not a profit measure, until you hold it against break-even ROAS |
| RSA (Responsive Search Ad) | The default search ad format on Google Ads and Microsoft Advertising. You supply up to 15 headlines and 4 descriptions and the platform tests combinations | Asset-level performance is what an audit can read; the platform decides the combination |
| TM Campaign | The trademark / exact-match brand-defense campaign bidding on your company name, product names, and close variants | Tightest match-type discipline. Sits alongside the Evergreen campaign rather than inside it |
| Target CPA | Your desired maximum cost per acquisition | Set below break-even CPA so each sale is profitable rather than merely tracked |
| Target ROAS | Your desired minimum return on ad spend | Set above break-even ROAS so advertising generates profit rather than covering cost |
| UTM Parameters | Tags added to URLs (utm_source, utm_medium, utm_campaign) identifying the traffic source | How Shopify and analytics platforms attribute an order to a channel, and what attribution validation reads |
What’s Next
- Getting Started with Trellis: revisit the high-level architecture
- Reading Your Audit Report: see these terms in context
- Attribution and Data Quality: deep dive into how tracking works