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Google (GOOG) to launch another marketing innovation

Google NASDAQ:GOOG Adwords logoGoogle (NASDAQ: GOOG) already has the lion's share of online search ads, but just to rub that in, it will introduce a program that may make its products seem even more attractive to advertisers.

The new program will allow marketers to put tiny websites, called widgets, across the Google AdSense Network, which covers the partner sites that run the search giant's text ads. According to The New York Times: "the new widget ads represent a more aggressive push by Google to attract big brand advertisers who like flashy ad units rather than the simple text ads commonly run in Google's ad network."

The widgets will allow Google's customers to run small videos or host chats within their advertising units. According to comScore almost half of US Internet users try widgets. That is 87 million people.

Will the widgets work? Probably not. At least not anytime soon. They allow advertisers so much freedom in creating new marketing messages that it may take months, or even a year or two, for big brand advertisers to measure which kinds of creative units play well with users.

The new Google program is helping make Internet advertising a lot more complicated. And, for now, that may not be good. Every marketer is going to have to work harder to come up with something that will catch people's attention.

Douglas A. McIntyre is a partner at 247wallst.com.

Widgets help make Facebook the most valuable turf on the internet

You've probably become used to the animated ads that show up on web pages such as ours. If you build your own web site, or use MySpace (News Corp, NYSE: NWS), or Google's (NASDAQ: GOOG) iGoogle Home Page, or My AOL (Time Warner, NYSE: TWX), you may have grabbed some useful miniprograms that allow you to imbed a clock, a stock ticker, a weather report, or headlines from a variety of web sites and feeds. These mini-programs are called widgets, and they are the hottest topic on the 2007 internet marketing scene.

Widgets offer internet page builders a good deal, providing interesting content, updated frequently, to make the web page more appealing. In return, the web page host allows them to add a bit of advertising.

The upside for advertisers is that this allows them to spread their brand across millions of sites without paying for the placement. The downside for consumers is that widgets slow load times and clutter the content. The downside for sites dependent on advertising revenue (such as ours) is that when so many people are giving it away free, it's harder to sell advertising.

The most important aspect of widgets, though, is that they allow the user to create her own newspaper-like home page, with bricks containing the feeds she follows in the layout she prefers. No longer does she need to browse the web; instead, widgets bring the web to her.

Therefore, in a widget world, the most important turf is the visitor's home page. A Facebook user, for example, can load widgets in his page that bring his favorite content to him. No longer will those sites enjoy the ad revenue from his site visits, but are reduced to what they can pack into their widget.

In a widget world, Facebook, with over 30 million regular users and growing exponentially, could be the most valuable turf on the internet. If, as Tom Taulli speculates, it is about to go on the market, we could be looking at Google-like valuation at the time of its IPO.

Veteran dot-commers invest in widgets?

According to a story in Red Herring, The cofounder of AOL, Steve Case, as well as a big executive name from the '90s, Ted Leonsis, have invested about $5.5 million in Clearspring.

Clearspring develops so-called widgets. Basically, these are small programs that can enhance a web site. For example, widgets can do things like show videos or allow for quizzes or slide shows. What's more, Clearspring has a proprietary system that allows for tracking the use of widgets.

It's cool stuff.

So, I pinged a good friend of mine, who works for a tier-1 venture capital firm. He also thought it was cool. But he did have a good question: "How do these guys make money?"

I'm not sure. But, at least for now, Clearspring is making money from some willing investors.

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.

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Last updated: February 11, 2012: 03:01 AM

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