Google is set to start displaying advertisements today to users based on their interests, which are determined using their previous online activities.  This form of advertising is known collectively as behavioral targeting, and has been adopted by most of Google’s competitors, drawing criticism from privacy advocates and some Congress members.

Google announced that it plans to offer new methods for users to protect their privacy.  Notably, Google will be the first of the behavior targeting advertisers to give users the ability to view and edit the compiled information about their interests, the information used to place similar ads on their screens.  Rival Yahoo gives its users the choice to opt out of “interest-based advertising”; Google is committed to provide the same service.  Privacy advocates praise Google’s decision to allow users access to the information compiled regarding their interests.

As for how the technology works, Google will use a cookie, which is a small piece of text within a Web browser.  The cookies have the ability to track users who visit any of the hundreds of thousands of sites that show ads through Google’s AdSense program. Google then assign those users to specific categories based on the content of the pages they view. An example of this is a user visiting real estate sites; they will be categorized as a potential homebuyer.

Google then uses the compiled and categorized information to place ads that are relevant to specific users and their interests. A potential homebuyer may see an ad about real estate not only on a real estate website, but also on an entertainment or news site that uses AdSense .  These targeted advertisements are also available on YouTube, which is owned by Google.  Brought to you by Deep Blue Interactive, your Fort Lauderdale based web design and SEO solution.

The long awaited verdict is in with regards to the long awaited proposed advertising deal between Google and Yahoo.  On Wednesday, Google officially announced its decision to bow out of the publicly scrutinized advertising arrangement.  The proposed arrangement of search engines #1 and #2 working directly together created controversy and nearly became a legal trial, as the Justice Department announced on Wednesday that if Google and Yahoo moved forward with the ad deal they would file suit to block the deal.

This past week Google & Yahoo offered the Justice Department a significantly revised version of its original advertising partnership plans for approval.  The revised plans were an effort to cooperate with the Justice Department, who has been scrutinizing the proposed deal in regards to its potential effect on competition.
Analysts say that the deal was a no lose proposition for Google, as they had nothing to lose if the deal did not go through, and in the meantime Google was able to keep Yahoo out of the arms of Microsoft.  Google’s chief legal officer David Drummond posted in their blog the following statement:

“Pressing ahead risked not only a protracted legal battle but also damage to relationships with valued partners.  That wouldn’t have been in the long-term interests of Google or our users, so we have decided to end the agreement.”

The proposed advertising partnership has stirred up much controversy over the past few months among competition, investors, regulators and the Justice Department.  Thomas O. Barnett, assistant attorney General to the Justice Department’s antitrust division said the following per press release:

“The arrangement likely would have denied consumers the benefits of competition-lower prices, better service and greater innovation.”

The majority of those concerned about the ad arrangement had relayed fears that Yahoo’s advertising system generates less profit from each search performed than Google’s.  The Justice Department had stated its fears that the agreement would reduce Yahoo’s incentives to invest in its own search advertising ventures and end up submitting larger and larger portions of its ad business to Google.  Brought to you by Deep Blue Interactive, your Fort Lauderdale interactive marketing firm.

Amid all of the controversy and press regarding the potential advertising agreement between online mogul Google and its smaller counterpart Yahoo, the two tycoons have agreed to a brief delay in proceedings.  The brief delay is reportedly a courtesy to the Justice Department, allowing them more time to investigate the alleged antitrust implications of the deal.

The extra window of time will give regulators extended time to fully investigate the proposed deal, ensuring that all interests are aligned legally and in the best interest of all parties involved.  Those who oppose the deal include several major advertising agencies and groups who claim the advertising partnership would give Google dominance and an unfair advantage over the search advertising market and could lead to a monopoly or increased prices.

In a statement Yahoo responded:  “We have had discussions with regulators and look forward to responding to their questions about this agreement.” 

Google also responded with a statement:  “As we are still in conversation with the Department of Justice, we have agreed to a brief delay in implementing the agreement while those discussions continue.”

Both parties are cooperating with the proper investigative authorities, and in the interest of time and money are hoping things are settled as quickly as possible.  The company’s valuable time equals money, and for this reason they plan to go ahead with the advertising deal in which Google will begin placing ads alongside some of Yahoo’s search results as early as October.  It is important to note that when Google and Yahoo initially announced the advertising deal in June, they voluntarily gave regulators 100 days to review it. 

This update has been brought to you by Deep Blue Interactive, your Fort Lauderdale integrated marketing solution.

You do not get to be the holder of upwards of 70 percent of the search advertising market without a clear and fine tuned strategy.  The principle that Google’s advertising business was founded on is to deliver the right information to the right person at the right time.

Both the search and ad team at Google is on top of their game, always working toward better results.  Google includes hundreds of thousands of advertisements with millions of products and services, and must filter them by relevance in a timely manner to discern which ads are useful to which users.  This is no easy task, but is now within reach compared to the early days of advertising.

Targeting advertisements involves understanding what users are looking for, and giving it to them.  Timing is crucial when an individual is searching for a specific product or service, and it is desirable to reach as many interested users who are at the point of purchase-therefore advertisers will invest more for Google ads because they see a higher return on their investment.  Components of a good advertisement have been analyzed and tested by Google for years, and they are continually tested.

Advertisements are being tested to be relevant to a user’s location and preferences, and users are starting to utilize these buttons to personalize their searching and advertising experiences.  The world of advertising is getting smarter and there are many breakthroughs to come.  Make sure that your company is at the forefront of the advertising era with Google and Deep Blue Interactive of Fort Lauderdale, Florida.  Strategic online marketing and advertising is the focus of future business growth and wealth.

As previously covered- opinions in favor of and against the proposed advertising deal between Google and Yahoo are strong. Those against the deal often cite the fact that Google controls roughly 70 percent of the search advertising market, painting it as a monopoly. Those in favor of the deal have researched further to analyze the facts.

While Google does control 70 percent of the search advertising market, it does not set the pricing. Advertisers set the pricing, bidding against each other for the amount they will pay when a user clicks on their advertisement. Microsoft, Yahoo and other companies operate in the same manner. At Google advertising spots are not simply sold to the highest bidder, quality scores are also factored in. A quality score is based on the relevance of the advertiser’s destination page to the search term and the prior history. The higher an advertiser’s quality score is, the lower the price of the advertisement.

This is all part of Google’s search algorithms whose goals are to link users with the products and services they are searching for. This is also the reason advertisers are willing to pay more for a spot on Google ads, because it is well known that Google’s software and technology is more likely to produce customers who make a purchase, because the ads are strategically targeted to relevant users- and advertisers are willing to pay more to reach those users. It is also a fact that Ask has renewed its advertising deal with Google in 2004 and 2007, since its initial startup in 2002–a keen indicator that it is lucrative for Ask.com. and could be for Yahoo as well.

Google has a large ad inventory; it makes sense for them to find ways to disperse them among other engines. The practice of auctioning prices to advertisers is so ingrained in this business that it is clear why Google and Yahoo did not see their advertising deal as a monopoly or threat to anyone else, and assumed they would breeze through the regulatory review to which they voluntarily submitted. The arrangement is simply Google supplying ads to Yahoo, the same as they do for Ask. To read previous entries on this topic, see Deep Blue’s blog, your Fort Lauderdale interactive marketing firm.