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Google’s Conversion Optimizer Updated

Google’s nifty little tool, the Conversion Optimizer, has been updated. Originally launched in September, the tool is designed to optimize Google PPC ads for conversion.

The Conversion Optimizer uses user data from your website to observe when most of your conversions occur from PPC ads. The Optimizer lets you specific a maximum cost per acquisition (CPA) for an adgroup, then automatically adjusts your bidding to keep your CPC down and your conversions up. It’s designed to minimize the cost per acquisition and maximize the number of conversions.

Currently, it sounds like the primary method for doing this is automatic dayparting. According to the official announcement, the Conversion Optimizer accomplishes all this by “showing ads when conversions are most likely to occur.”

The Inside AdWords blog cites one case study of this in action from Moritz Daan, CEO of Webgamic’s CEO:

Clients Ask Ad Agencies to Diversify

Ad executives are going to have to change the way they do business and include more progressive methods to reach customers. Marketers want more focus on other advertising like online video and social networking sites and less on traditional media alone. That’s according to a recent article in the Wall Street Journal.

As the economy slows, more businesses are attracted to Internet advertising. Not only is it often less expensive, but it’s also easier to measure than tv and print ads. Every prediction I’ve seen shows growth in this space outpacing growth in traditional advertising methods. Merrill Lynch predicts ad spending in the U.S. will grow 2.3% this year and that businesses will move more budgets online – increasing the portion spent online to 18%. Publicis Groupe’s ZenithOptimedia says it spending online should exceed that spent on radio as soon as this year. The Internet should outspend magazine advertising by 2010.

Advertisers Banking on Social Networking in 2008

If you look at all the hype around social networking, you might think that it’s a fad that will soon fade. Advertisers don’t think so. After seeing how many teens and adults (40%) in the US are on social networking sites, they are upping their budgets for the new year.

Last year, advertisers spent $920 million advertising on social networks. They plan to spend a lot more this year – 69 percent more, according to eMarketer – around $1.6 billion. It’s not expected to slow either. In the next four years the figure is expected to reach $2.7 billion.

Advertisers are still trying to see what works on popular sites like Facebook, MySpace and niche online social networks. In a report titled: Social Network Marketing: Ad Spending and Usage, author Debra Aho Williamson, points out that:

The Marketing Tools You Need in 2008

Social media guru–and newly minted Forrester analyst–Jeremiah Owyang has compiled a comprehensive list of the online marketing channels companies need to consider in 2008.

His list of tools includes web sites, blogs, social networks, widgets, SEO, and much, much more. He’s looking to compile the definitive list, so head on over there and leave a comment if you think he’s missed anything.

Kayak.com Acquiring Rival SideStep.com

Travel search engine Kayak.com is paying $196 million to acquire its closest competitor SideStep.com. Both are search engines to help travelers find the best prices on airfare, hotels, and car rentals. Like most search engines, they make money with partnerships and advertising.

The deal was financed from many sources, starting with Sequoia Capital, General Catalyst Partners and Accel Partners. SideStep investors include Norwest Venture Partners and Trident Capital. New investors Oak Investment Partners and Lehman Brothers Venture Partners.

They do plan to keep both sites separate in style and branding but combine some of their technology. Kayak looks more like a search engine, while SideStep is has a richer interface and more content (Kayak’s blog could use some influence from SideStep). Kayak has some plugins and widgets while SideStep has a review site and social network for travelers.

A Year in Review – Ad Agencies Acquired

Yesterday marked yet another acquisition of an advertising agency, and perhaps one of the last of 2007. This year has brought so many acquisitions, and big news such as Google getting the federal go-ahead to buy DoubleClick.

AOL announced yesterday that they have completed an acquisition of online advertising company Quigo for $340 million. The deal was announced last month. Quigo is the fourth advertising company AOL has acquired this year. Others include: Third Screen Media (mobile advertising) for $80 million, ADTECH (ad serving platform based in Germany), and TACODA (a behavior targeting ad agency) for which they paid $275 million.

Here is a wrap-up of 2007′s biggest advertising agency acquisitions

February 2007
Google buys AdScape for $23 million – so they can develop in-game advertising.
Omniture buys Touch Clarity for $51.5 million

Microsoft Launches Affiliate Program

Microsoft has launched a new affiliate program for paid search ads (Microsoft adCenter) and their security and PC backup service Windows Live OneCare.

There are two ways Affiliates can earn cash.
1. Each time someone signs up for a free trial of Windows Live OneCare.
2. The Microsoft adCenter program – which I can’t find details about – but you can earn cash each time someone you refer from your site signs up for paid search ads.

They are launching Microsoft adCenter with a $50 ad credit for your visitors (Andy ought to sign up Marketing Pilgrim!).

Microsoft will provide the banners to put on your blog or web site. I can’t find figures on their payouts.