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2015 Car Sales Terminology and Dictionary plus Tips

Updated on March 11, 2015

2015 Car Sales Terminology and Dictionary with Tips

The author has been in the car business for over 25 years, selling Cadillacs, Conversion Vans, Chevrolets, Hummers, Jaguars, Lexus, Kias, Volvos and used cars. He has worked at car dealerships and lots in California, Utah, Virginia and New Jersey as a salesman and as a manager. The follow compilation of car sales jargon is common in most dealerships though it may differ slightly from region to region.

This is a beneficial guide for both the prospective buyer and anyone who is interested in becoming a car, truck or other transportation salesperson.

The author has chosen to use the reference of “he” instead of “he/she” to make for easier reading.

ACV – Actual Cash Value. Also referred to as CV. This is the actual wholesale amount (before reconditioning) of what the dealership thinks your trade-in is worth. As a customer you never really know the cash value that the dealer assigns to your car. A strong salesperson will usually show the customer a number that is lower than the ACV to give him some negotiating room if needed. The salesperson’s goal is to take in the trade at a number that is lower than ACV in order to increase the profit to the dealership and maximize his commission.

AD LEADER – An advertised sale price on a specific in-stock vehicle(s). This is usually a base model with few or no options, advertised at a very aggressively low price. There is often only one ad leader car available at a time. This advertisement is designed to bring in customers who might then switch to a different, more expensive vehicle.

ADMINISTRATION FEE (Processing Fee) – This fee is imprinted on the contract. The dealership will explain that this fee is to cover a variety of different administration fees, like title searches and tag work. The truth is this is just extra profit for the dealerships. Sometimes this can be the only profit in the deal.

ALLOWANCE – Used in conjunction with the terms, “over” and “under.” Over allowance is when the customer is quoted a trade-in value that is actually more than what the dealership thinks the car is worth. Everyone thinks that the dealership is trying to steal their trade-in so instead of lowering the sales price of the new car, they quote (allow) the customer more for their trade in an effort to make you feel good about your purchase. But this is a dangerous tactic for the dealership. If after getting an over-allowed price on their trade, they switch to a different car to buy, the dealership may not have enough (or any) profit to make the deal based on what was previously quoted for the trade. In this case the dealership will have to explain what has happened. For this reason the customer should not even talk about a trade until the sales price for the new vehicle has been fixed.

AUCTION– A central location where dealerships send their unwanted cars to sell to other dealers. Used car lots get most of their inventory from auctions.

BACK END – The profit made by the finance department, to include financing, insurance, gap coverage, extended warranties, and other protection plans. The back-end is usually more profitable than the front end….it’s like when you go to the movies. The theatre doesn’t make money on the ticket sales but on the concession stand.

BACK OUT THE DEAL (Unwind the Deal) – To make the completed sales null and void. Unwinding the deal is usually due to a miscommunication where the customer claims he did not get what he was promised. For example, the salesperson said the vehicle had a towing package but it does not. In most cases the dealership is not legally obligated to take back the vehicle but does so in order to avoid negative publicity.

BE-BACK – A customer that has previously visited the dealership and has now returned for another visit.

BIRD DOG: A person who refers a customer to a dealership or salesperson for a fee. Bird dog fees are illegal in most states and frowned upon by most dealerships. The fee is usually paid in cash from one salesperson to another and is therefore hard to prove.

BLACK BOOK – An independent company that provides dealers with the latest sales data from the auctions for specific makes and model vehicles. Many dealers reference the Black Book when placing a dollar value for a trade-in.

BLIND APPRAISAL – A trade-in appraisal for a vehicle that is not in front of the Appraiser. Many customers insist on getting a trade-in number without the vehicle being brought to the dealership. Dealerships may give the customer a wide-range idea, but never a hard number.

BOTTOM FEEDER – A customer that comes to the dealership, usually at the end of the year, and offers the dealership a deal that is way lower than the dealership can accept. He has always done his homework, so he knows about all of the rebates and dealership programs and probably the actual dealer costs. This customer seldom buys on the first visit because he will work one dealership against another in order to get the absolute lowest price. The bottom feeder will buy from the lowest bidder…..there are no other considerations.

BRASS HAT – A vehicle that was driven by an executive from the factory. These cars are made available to the dealerships at a reduced cost. It’s a good deal if you can find one.

BUREAU- A credit report on a customer.

BUYBACK - a vehicle that the manufacturer bought back from the owner due to excessive issues and problems that the dealership or factory can’t resolve. The buyback will usually go to an auction and be purchased by someone with a dealer’s license. If a dealer sells a Buyback to the public, he has to disclose the vehicle’s history to the buyer.

BUY RATE - This is an interest rate promised by the bank to the dealership for a specific customer based on his credit history. In most cases the dealership is allowed to bump the rate from between one to three points. The dealership receives the profit from the bump.

CARFAX – An independent agency that provides the reported history of a vehicle for a fee. The Carfax is one of the dealership’s most important tools. The dealer researches the Carfax report for every car they appraise for trade in, and also uses the information as a sales tool for vehicles they are attempting to sell. It should be noted that the Carfax report is not always 100% accurate, as they can only report what has been reported on the car by insurance claims and police accident reports.

CASHING THE DEAL - This is the final step in the transaction for the dealership. A lender has accepted the contract and paid the dealership.

CEMENT THE DEAL (Button up the deal) – The final step of the sales process where the salesperson reassures the new car owner that they bought a great vehicle at a great price, from the best salesperson and the best dealership. The last part of this step is a series of follow-up calls to the customer before the CSI Survey arrives.

CHASSIS- The chassis is the frame of the car, upon which sits the engine, suspension and transmission.

CLOSER -The second half of a Lander/Closer dealership. The Lander helps the customer select a specific car to purchase and is then turned over to the closer to complete price and other negotiations. The closer is a half step below the manager.

CO-BUYER (Co-signor) – A guarantor. The co-buyer signs behind the buyer and agrees to abide by the terms of the contract if the buyer defaults.

CREDIT CRIMINAL – A buyer with bad credit.

CSI – Customer Satisfaction Index – a rating earned by dealerships based on surveys sent to the customer after the sale. This rating is just as important to the dealership as selling the car. Dealerships receive huge amounts of money from the factory based on the answers from the survey, and the salesperson gets a spiff if he maintains his rating above the national average (usually around 92%).

CURB APPEAL (Has Eyes) – The aesthetic appeal of a vehicle based on its lines and condition.

CURBING A CAR- When a salesperson persuades a customer not to trade in his car because he knows someone who would like to purchase his trade and will give him more than his car was appraised for by the dealership. This is the worse crime a salesperson can commit against the dealership. Even though the dealership was not involved in the transaction, the courts could rule that the sales person was an agent for the company, which means the dealership could be held liable for any promises made by the salesperson. Curbing is not only an insult to the dealership; it’s also steals business from the dealership.

DEALER CASH – Money given to the dealership from the factory to aid in selling specific models. This money does not have to be disclosed to the buyer.

DE-HORSE - The customer is taken out of his trade and put into a dealership loaner car while the details of the transaction are completed. This persuades the buyer that the deal will go through and takes them out of the market. Often times this is due to the new car not being available at the time of the sale or perhaps due to unresolved credit issues.

DELIVERED – The transaction is complete. It does not mean that the purchased vehicle has been taken to the customer.

DELIVERY – This term should be eliminated from dealership jargon. Delivery refers only to “settlement”, though often times the customer will interpret this term to mean that someone from the dealership will “deliver” the car to their front door.

DEMO (Demonstrator) – An untitled new car that has been driven by an employee of the dealership and sold to the public at a reduced price.

DEMO DRIVE – The salesperson accompanies the customer on a pre-set route in order to demonstrate features, explain the benefits, and establish and emotional connection between the customer and the car.

DENT AND DUST GIRL– I love this one. At most dealerships, especially new car dealerships, after the customer agrees to the terms of the lease or purchase, they are escorted to an office to talk to a sales person about after-market products, while the business office readies the paperwork. This sales person is always a female, often dressed like a hooker displaying her wares. While explaining the products she will lean over the desk (for men) so that the customer gets a good view of what she has to offer. Most of these flashy products are over-priced impulse purchases. All of the buyer’s work to save money on the sale can be lost in this office. The salesperson gets a small piece of the action, so he will set up the customer before delivering them to the hammer.

I recommend that the customer never buy a new car on the first visit. That “today only” price will be good tomorrow unless a factory rebate ends today. With new cars you can almost always find the same car somewhere else. It’s a little bit different with used cars, as no used car is the same.

DESK (Tower) - The brain center of the sales department. Usually the Tower is located on the sales floor and is often elevated so that management can supervise the floor activity. This is where the salesperson goes when he leaves the office to talk to a manager who sets prices, consider offers and constructs counter offers.

DESK A DEAL – A process in the sales negotiation where the salesperson leaves the customer to present an offer to the manager who then accepts the offer and makes a counter offer.

DESTINATION CHARGE- A transportation charge assessed by the factory to every new car. This charge is listed on the MSRP.

DEVALUE TRADE – When it’s time to do the trade appraisal the strong salesperson asks the customer to accompany them to their vehicle for a walk-around. In most cases the customer has done some online research and has a good idea of what the books say their vehicle is worth. The salesperson knows that the customer has a number in his head. His job is to place some doubt in the customer’s mind and show him why his vehicle is not worth what he thinks. The salesperson carefully inspects the exterior and interior pausing at every defect. Usually the customer will volunteer a story of how it happened. For the bigger issues such as a smashed fender, which obviously has to be replaced, the salesperson might say something like “Oh, I think that will buff out!” Most customers will laugh and hopefully relax a little bit. By the time the salesperson gets back into the office he has a big advantage when he starts to talk numbers.

DOUBLE DIP: To finance purchase between two or more loan companies. No finance company will knowingly agree to a customer double-dipping.

DOWN PAYMENT – Money that the customer gives the lender in addition to the contracted monthly payments. The down payment may be required by the lender unless the buyer has excellent credit. The more money that they buyer puts down, the lower the monthly payment.

DROP YOUR PANTS – Slang expression where the sales manager is so desperate to make a deal and accepts a very low purchase offer from the customer.

ETCHING – Several parts of the vehicle have the VIN etched into on them so that if the vehicle is stolen it can be traced back to the lawful owner. Some manufacturers include etching as a standard feature, whereas the business office offers this service as an add-on soft cost to other customers.

ETHER – Also “Under the Ether.” This term is usually used in conjunction with the business office. This condition occurs when the buyer is so worn out or confused that they buy everything offered in the business office, often at retail prices.

F & I - Finance and Insurance department. This is a somewhat outdated term since very few dealerships sell any form of insurance. The F & I department presents the customer with different purchase/lease options, along with other products such as gap coverage, extended warranties and service contracts. A knowledgeable buyer has already secured loan information from his own lending sources, and as such is in a good position to negotiate interest rates with the finance manager. If the buyer is convincing, he will probably get most aggressive rate that the business manager can offer.

FINANCE BUMP – It used to be that dealerships were allowed to increase the rate over what the lender agrees to, as long as it still falls within their loan guidelines. For example, if the lender agrees to take the deal at a six percent interest rate, the dealership increases the rate three points and the buyer is contracted at nine percent. The lender then pays the dealership on the extra three percent. In recent times the lenders usually only allow the dealership to bump the rate one point or in some cases not at all. In these cases the lender only gives the dealership a flat administrate fee (usually about $350 to $450).

FLAKE - A customer that is not qualified to purchase due to bad credit or insufficient down payment.

FLAT – This is the same thing as a “Mini”. This is the guaranteed minimum commission paid to the salesperson for selling a specific vehicle. This amount can vary from $50 all the way up to thousands of dollars depending on the situation.

FLIP - To convert a customer from one form of financing to another. It can also refer to a customer that is turned over to a different salesperson to work.

Floor Manager – A junior grade manager that is always on the floor to supervise the activity and salespeople. He is also empowered to make deals and solve problems.

Floor Plan – A cost to the dealership to insure his inventory.

Floor Whore – This term is given by the sales force to a salesperson that is always on the floor attempting to take every customer they can get. He is typically new to the dealership. These sales people very often burn through customers, looking for an easy fast sale so they can get back on the floor. The Floor Whole often skips steps in the sales process or makes promises that are contrary to dealership policies in order to get the sale and get back out on the floor. The floor whore cheats both the customer and the dealership.

FLUFFING - An illegal procedure whereby a salesperson, sales manager or finance manager alters a customer’s completed credit application in order to make the offer more appealing to a lender. In recent times this process has pretty much disappeared as the penalties have dramatically increased due to the enactment of the Privacy Act.

FOUR SQUARE – An old fashion sales procedure whereby the sales person takes a blank piece of paper and with a pencil divides the paper into four squares. In each square the salesperson writes down a different aspect of the sale, for example sell price, payments, trade and term. The salesperson then attempts to close each square.

FRAME DAMAGE – Damage to the frame (chassis) caused by an accident. A dealership is required to inform the customer if the vehicle has reported frame damage or airbag deployment.

GAP COVERAGE – An add-on policy that in the case of an accident or theft covers the delta between the value of the car and what is owed on the contract. Most leases include gap coverage to protect the lender.

GET ME DONE – A working deal with credit-challenged buyers. This kind of deal is very seldom completed on the first visit as the finance manager has to make calls to the lenders to find out what can be done to make the deal.

GOLDEN QUESTION – This is the salesperson’s most important question in the negotiation process. It goes like this, “Other than the money, is there any reason why you cannot make a buying decision today?” If the customer replies “yes” then the salesperson will try to uncover and address the objection(s). The experienced salesperson will defer from talking numbers until all of the customer’s objections have been resolved. A “no” response lets the salesperson know that it all comes down to dollars and cents and that he is clear to proceed.

GREEN PEA- A new sales person….one who has not previously sold cars or has very little experience.

GRINDER - A buyer who negotiates every aspect of the deal trying to save a dollar here and a nickel there.

HIGH BALL- A figure given to a prospective customer which is an inflated value of his trade-in in order to get the customer to return to the dealership to purchase his new car.

HOLDBACK – This refers to new cars only. This is a dollar amount which is included on the invoice and given to the dealership by the factory at the end of the year. Salespeople are told that this cost is to cover the operating expenses for the dealership. Before the internet dealerships would never sell a vehicle under Holdback. Now it is common; so ask about it.

HOME RUN- When the dealership has made all of the profit that is available from the sale of the vehicle and the Business office.

HOOPDI – An old car or worn-out vehicle that still has some limited value. This differs from “Old Iron” in that the hoopdi is often purchased by a dealership employee (usually a technician) to drive as a personal car.

HOUSE DEAL – Where the manager does all of the sales work and then hands to completed deal to the salesperson to deliver.

HOUSE MOUSE – A sales manager’s favorite salesperson. He gets all of the “House Deals.”

INVOICE – A document from the factory describing a specific vehicle in regards to equipment, retail, and dealer cost numbers. It also includes the costs for delivery, hold back and advertising.

KBB – Kelly Blue Book – A private company that provides values to vehicles based on sales data for a particular region of the country.

LANDING– When the salesperson and the customer work together to select a specific car to lease or purchase.

LAY DOWN – A customer that purchases a vehicle with little or no negotiations or problems.

LANER - The first part of the Linder/Closer team. The lander lands the customer on a specific vehicle, completes a preliminary worksheet, hopefully get some kind of offer, and then turns the customer to the closer who works the deal and hands off the paperwork to the manager to be approved and passed on to the business department.

LOCATE– After you decide on the new car model you want to purchase you find out that the dealership does not have the car with the color and options that you desire. The dealership will try their hardest to sell you what they have in stock rather than contact another dealership to trade with them. Dealerships hate to do “locates” because it costs money to transport the vehicle and there is a plethora of things that can go wrong. Typically the sales manager will find a car in his inventory that is close to what the buyer desires, and make a very attractive offer to buy in stock. A clever buyer could even purposely work a locate deal in order to get a great price on an in-stock vehicle.

LOT LIZARD – This is the same as a “Floor Whore” only outside on the lot. This salesperson stakes out the lot, often walking around the inventory acting like he is performing some task in an attempt to trick the sales force and jump on the next person who drive on the lot. This is the salesperson that jumps you as soon as you get out of your car.

LOW BALL - These are walking numbers given to a customer that is leaving to shop the dealership’s offer. The dealership gives the customer a purchase number that it lower than what they can actually honor. The idea is to get the customer to return to the dealership to complete the deal. When the customer returns he finds out that the car has been sold or that someone has a deposit on it.

MIND DEAL – Slang term used by the sales staff that refers to a potential deal that has not been completed, usually due to snakes in the deal.

MSRP – Manufacturer’s Suggested Retail Price – The window sticker.

NEGATIVE EQUITY - When the customer owes more on their vehicle than its trade-in value. Negative equity must be accounted for in the new deal. The customer can either pay in cash to cancel out the negative equity or “roll” it into the next purchase, which increases the monthly payment or overall purchase price. Negative equity is added to the sales price of the vehicle and as such is subject to sales tax.

OLD IRON – A vehicle that has no retail value. This car is typically sent to the auction or sold to a wholesaler who then sells it to either a salvage yard or a corner car lot for their inventory.

OVER-THE-CURB – No transaction is complete until all of the paperwork has been signed and the car has driven off of the lot. The deal is done when the vehicle is over the curb, or burning fossil fuels.

PACK– This is an additional charge that the dealership adds to the cost of the vehicle. This pack does not affect the customer, but is designed to reduce the salesperson’s commission since sales people do not get paid on the pack. In the old days packs were never applied to new cars. Typical “packs” these days are from $600 to $1,200 per vehicle. In this example this would represent of loss of commission of between $150 and $400.

PENCIL- This is part of the negotiation process where the salesperson goes back and forth with an offer sheet from the buyer to the manager. If the customer makes an offer that is unacceptable, the manager crosses out the offer and writes down a count-offer. If the negotiations reach an impasse the sales manager takes over and negotiates with the buyer face to face. This should be the goal of every buyer because the manager will always accept a lower offer than the salesperson can accept.

PRE-QUALIFY- When the sales person makes assumptions about a customer’s ability to purchase a vehicle. Common forms of pre-qualifying include the customer’s race, sex, appearance or age. This is a big mistake for a salesperson. Often times the person who walks on the showroom floor dressed in ratty clothes can buy the dealership if he wants and the person in the three piece suit can’t finance a first class postage stamp.

PROCESSING FEE (Administration Fee) – This fee is imprinted on the contract. The dealership will explain that this fee is to cover a variety of different administration fees, like title searches and tag work. The truth is this is just extra profit for the dealerships. Sometimes this can be the only profit in the deal.

PUT ON A ROCKET (Low Ball) – The dealership know that a customer is not going to buy today because they want to comparison shop other dealerships. The dealership gives the customer walking numbers that are lower than they can honor in an effort to get the customer to return. When they do return they find that there is a deposit on that car or it has been sold, etc. This can backfire on the dealership if another dealership is desperate enough to take your numbers in order to make a sale and keep the competition from making the sale, even if it is at a loss. For this reason, dealerships will not give you a written documentation of this offer.

REBATES– Factory money credited to a buyer for the purchase of a vehicle. The dealership is required to inform the customer of the rebate. The customer pays taxes on a rebate.

RECONDITIONING – The dealership process of bringing the vehicle up to at least state safety requirements.

RESIDUAL - In a lease this is also the “Guaranteed Purchase Price” at the end of the contract. It is the estimated value of the vehicle after the contract is up as determined by the lender.

ROACH (Credit Criminal) – Customer that is financially challenged.

ROLL BACK - There are two definitions. A “rollback” is a vehicle that transports one vehicle at a time. It can also refer to the process of “rolling back” the odometer on a car, which is very illegal.

SERVICE LANE WALK - When he is otherwise not busy, a smart salesperson will go to the service area and talk to customers that are in for service in an attempt to sell a replacement car for their troubled or high mileage car. This approach is usually very low key and even if the customer is not currently in the market the salesperson gives them their business card in hopes of getting their future business.

SPIFF - A bonus paid to the salesperson as an incentive to sell a particular car. This is in addition to the regular commission.

SPLIT – This term describes a situation where the customer is worked by two salespeople who spit the commission. This is a very common situation at all dealerships, since the salesperson cannot allows be at the dealership, or the salesperson is busy when the customer arrives and he has to ask another salesperson to take over in the process.

SPOT DELIVERY- This is when the deal has been approved and the customer is ready to take possession of the vehicle now. Dealerships push for spot deliveries in order to avoid any problems that may arrive later and to combat possible buyer’s remorse. It also allows the dealership and the salesperson to get on to new business.

STRAW PURCHASE- A straw purchase is done without the consent or approval of the lender. The customer is buying the vehicle in their name for someone else to drive due to their bad credit or other issues that would otherwise make them ineligible to purchase (or lease). Often times the salesperson knows what’s going on but will not mention it to management.

STROKER - An individual who gives the impression that he wants to buy a car, but really doesn't have the means to do so or is just wasting the salesperson’s time.

SWITCH – This is not necessarily deceptive. It just involves the dealership suggesting that you consider a different car for whatever reason. It could be that the customer can’t afford the car that they have chosen or the car they looked at yesterday was purchased by someone else today.

TEN STEP PRESENTATION – A set process of presenting a vehicle to a customer. Most dealerships require that all salespeople follow this process. The numbers vary from dealership to dealership but they are basically all the same. The steps are: Meet and greet, fact finding, product presentation, demonstration drive, introduction to service and parts departments, trade appraisal, working numbers, introduction to business office, delivery, and follow-up.

THIRD BASEMAN- This is the expert that some customers bring with them to the dealership to make sure that the salesperson won’t screw them. These experts usually aren’t experts but take great pride in convincing the customer they know what they are doing. These experts usually do more harm than good for the buyer.

TIRE KICKER - The person who is not in the market for a vehicle but is either just curious or is just passing time until the movie starts.

T.O. - When the customer is “turned over” to a different sales person or manager to be worked.

TOWER (Desk) - The brain center of the sales department. Usually the Tower is located on the sales floor and is often elevated so that management can supervise the floor activity. This is where the salesperson goes when he leaves the office to talk to a manager who sets prices, consider offers and constructs counter offers.

TRADE APPRAISAL – The process of determining the wholesale value of a vehicle.

TRUNK MONEY – Money given to the dealership to help sell specific models. Until the internet became popular customers did not know about trunk money. It sometimes takes a little while before this becomes public knowledge.

UNDER ALLOWANCE – An experienced sales person will often show you less on your trade than for what is was appraised. This gives the salesperson flexibility should he need a little more money in order to make the deal. Of course the ultimate goal is to make more profit and a higher commission.

UNWIND THE DEAL- (Back Out) -To make the completed sales null and void. Unwinding the deal is usually due to a miscommunication where the customer claims he did not get what he was promised. For example, the salesperson misrepresented the vehicle as having a towing package. In most cases the dealership is not legally obligated to take back the vehicle but does so in order to avoid negative publicity.

UP- This is the customer’s first visit to the dealership. They have had no previous contact with the dealership or any specific salesperson.

VIN - Vehicle Identification Number. This number may be etched onto different parts of the car, such as the engine, or transmission. It is always displayed on a plaque located on the driver’s side of the dash next to the bottom of the windshield. It is used to identify the vehicle for purposes of proving ownership.

WALK AROUND – The process of presenting a vehicle in a set methodical way, showing features and explaining benefits.

WALKING NUMBERS – Purchase numbers given to a customer that is leaving the dealership without making a purchase.

WHISKEY BUMPS – small dents and dings on a car that can be easily fixed, usually by a subcontractor that visits the dealership on a weekly basis.

WHOLESALER– A person that is properly licensed to buy and sell cars. Wholesalers must maintain a lot with a minimum number of vehicles and a building.



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