Only a few years ago we would have all asked, ‘What is a Facebook’ and ‘What is a Twitter’,because the online world changes so quickly. Behind the scenes there is a battle raging that will impact the way we sell and the way we buy in the days ahead. Here’s a small insight…

‘….Selling ads is Google’s big money-maker, but the online-ad business is broadening away from Google’s sweet spot, selling ads tied to the search-engine terms people use. Instead, advertisers want to target people based on more specific personal information such as hobbies, income, illnesses or circle of friends.

The changes at Google reflect a power realignment online. For years, the strongest companies on the internet were the ones with the most visitor traffic. Today, the power resides with those that have the richest data and are the savviest about using it.

That has propelled internet ad companies into an arms race so swift that even Google fears being left behind. One slide from an internal presentation in mid-2008, which was reviewed by the Journal, is headlined bluntly: ‘Get in the Game’.

That particular slide describes the importance of breaking into the lucrative business of selling ‘display’ ads, which are larger ads with pictures, as opposed to smaller text ads. Today, Google still trails market leader Yahoo in US display-ad revenue, according to analysts. Google still leads the internet pack overall, of course.

Its revenue, $US23.7 billion last year, is more than three times Yahoo’s, its closest competitor. Its online advertising business is growing faster than those of its publicly held US rivals.

But Google’s revenue growth has slowed dramatically. And social-networking powerhouse Facebook is a widening threat with its ability to sell highly targeted ads to its more than 500 million users.

Fears about Facebook run deep at Google, which is designing its own social-networking service.

In a sign of how quickly things change, Google’s 2008 vision statement scarcely mentioned social networks. Google also plans to go head to head with Facebook’s ‘Like’ button – a tiny tool on many websites that lets people tell friends they ‘like’ something.

Each click gives Facebook valuable personal data about internet user’s interests.

Few online companies have the potential to know as much about its users as Google….’

For those of us in business, as we use these tools – the more targeted our advertising can become with the assistance of these battling giants is going to mean one thing – more business for all of us who choose to engage this technology as part of our marketing campaign.

Source:  Jessica E. Vascellaro The Wall Street Journal