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Google Expanding its Frontiers: Click Fraud

Google premiered a number of new sites today, including several ventures in China and a new click fraud resource center.

The new Ad Traffic Quality Resource Center is designed to help AdWords advertisers report and avoid bad clicks—but more importantly, it’s for Google to communicate about click fraud with advertisers and reassure them.

venn diagram of click fraud from GoogleGoogle illustrates click fraud for their advertisers, stating that they automatically compensate for virtually all click fraud by using a click fraud rate that they know is too high. By creating “false positives” in click fraud, Google ensures that their advertisers aren’t overcharged. Google refers to this as “proactively detecting” click fraud, and states that on average 10% of all clicks are invalid clicks which fall into this category:

The Portal is Dead – Long Live the Portal

It was this time last year that AOL jumped on board the advertising business wagon in an effort to tap into its 90 million monthly visitors and turnaround its wailing fortunes. But let’s face it – it’s like turning an oil-tanker in the English Channel!

A slowdown in advertising revenue to 16 percent growth last quarter (compared to 40 percent the previous) has left AOL execs split down the middle. Many are now raising questions about the transformation plan, while others accept that the prospect of exceeding the overall Online Ad growth rate is no longer realistic.

Despite eMarketer’s prosperous 28 percent growth forecast for the US, Internet usage trends indicate stormy weather for the portals – especially giants like AOL, Yahoo! and MSN. Analyst for RBC Capital Markets, Jordan Rohan, sums up the outlook:

Google Just Keeps Getting Richer — New Change to AdWords Announced

Tonight the Inside AdWords blog announced that Google is going to change the ad placement algorithm, replacing actual CPC as a factor with maximum CPC.

How does this affect advertisers? Well, by Google’s estimation, this is a GOOD thing for advertisers:

Actual CPC is determined, in part, by the bidding behavior of the advertisers below you. This means that your ad’s chance of being promoted to a top spot could be constrained by a factor you cannot influence. By considering your ad’s maximum CPC, a value you set, you will have more control over achieving top ad placement.

In addition to increasing control for advertisers, the improved formula increases the quality of our top ads for users. This is due to more high quality ads becoming eligible for top placement, thereby allowing our system to choose from a larger pool of high quality ads to show our users.

Online Ad Spending to Pass US Newspapers by 2011

There’s a new report out today that suggests online advertising spend will overtake US newspaper advertising by the year 2011, according to FT.com.

The findings are from a widely-watched annual research report on the media sector by Veronis Suhler Stevenson (VSS).

In the 2007 study, published on Tuesday, VSS forecasts that online advertising will grow by more than 21 per cent per year to reach $62bn in 2011, making it bigger than newspaper advertising, which is expected to total $60bn in 2011.

Broadcast television and cable and satellite television combined will continue to take the biggest share of advertising dollars, and are forecast to reach $86bn in 2011.

Makes you wonder if Google’s expansion into print advertising is a smart move or not.

Whadya think?

Your Marketing Job Now Outsourced to India & China

There’s a disturbing side-effect that’s coming from the increased use of internet marketing – it can be done cheaper in China and India.

While advertising continues to bring us greater efficiencies and cheaper costs, it’s also driving our need for faster turnaround and rapid deployment. When you can test 100 ads online within a week, you need a solution that can keep up with that pace, without breaking the bank.

I’ve seen two stories recently that suggests that marketing could follow technical support and end-up outsourced to a country with cheaper labor costs.

First, the NYT reports on Publicis’ efforts to build a global digital advertising network that uses offshore labor.

There’s a Use for Display Ads, After All!

Who knew display ads might actually be useful? A new study from Yahoo and comScore finds that online display ads produced 11% lift in dollars spent in in-store conversions. Search ads yielded a 26% lift in dollars spent.

Most impressive, however, was the result from a combination of search and online display ads: a 83% lift in dollars spent in later in-store conversion. The combination also increased incremental in-store revenue 90% (as opposed to 43% with search-only ads and 15% with display-only).

Display ads were also found to increase page views 37%—comparable to search ads’ effect (46%). Together? 68%.

Finally, MediaPost reports:

The study also found that a joint display and search campaign was more effective at converting online researchers to in-store purchasers–as the combination pushed 43% more in-store purchases than search (26%), or display (6%) alone.

AOL Acquires Behavioral Targeting Ad Network Tacoda

AOL has decided that its recent acquisitions of Third Screen Media, AdTech AG, Lightingcast and Advertising.com, didn’t quite send the message that the company is serious about online advertising.

To that end, the company has announced the acquisition of Tacoda, an online behavioral targeting advertising network.

“The acquisition of TACODA will build on our advertising momentum, letting us better serve advertisers by enhancing our ability to precisely target advertisements across an even broader network,” said Ron Grant, AOL President and COO. “We are committed to bringing advertisers and publishers a full range of tools and services, along with the widest reach, and with TACODA we’re taking another step toward that goal.”