Search Engine Land reader Alex, who works in the hospitality industry, tipped us to this development and at least one of our SEL editors was able to replicate it on a search for “las vegas hotels.”

The Hotel Finder ad is listed as a “comparison ad” and is separated very slightly from the regular AdWords listings below it. It occupies premium space at the top of Google’s search results and pushes hotel ads and organic listings further down the page. The comparison ad invites searchers to select a hotel quality level and click a “Book hotels” button. It’s quite similar to the mortgage comparison ads that Google launched in late 2009. Comparison ads are now also available for credit cards, checking accounts, savings accounts and CDs (the money kind, not music).

Clicking on the Hotel Finder comparison ad leads the searcher to the Google Hotel Finder, an experiment that Google launched in July.

The Hotel Finder is a somewhat innovative hotel search tool that mainly separates itself from some other sites by letting users draw shapes on a map to indicate where they’re looking for a place to stay. From the Hotel Finder, searchers can book hotel rooms directly via Google’s Hotel Price Ads — an ad program that seems to mainly consist of third-party advertisers, not hotels themselves.

I won’t claim to speak for anyone in hospitality businesses, but as our tipster Alex said, “this is huge for the hotel industry.” These Hotel Finder ads, if and when they become more than a test, would be the first that aren’t related to the financial industry.

Google Hotel Finder is a search tool specifically designed to make it easier to find and compare hotels for your trips. The features include:

• Draw simple shapes to define the neighborhoods (yes, more than one!) that interest you.
• See popular locations on maps with highlights
• One click adds hotels to your shortlist, where you can review them easily.
• See if you will get a good deal by by comparing a hotel’s current price with its typical one.

It starts with the filter on the left hand side that gives you various options such as:

• Location Filters (with drawing shapes
• Dates for your stay
• Price point filters
• Hotel ratings & user rating filters

Here is a screen shot of the side bar:

Once you type in a location, you can then position the map with your clicker and draw lines around the specific location you want to stay. Google will then show you hotels in that area.

Clicking on the hotel icons on the map will show you more details about the hotel. You can then book the hotel or add it to your shortlist:

Booking a hotel is driven by Google Hotel Ads:

If you are unsure, just add it to your shortlist and you can compare the hotels on your list. Google also shows you if the price the hotel is currently offering is a good price based on the average prices the hotel charges throughout the year.

There are many hotel search engines, including hotels.com and many others. Will this Google Hotel Finder last or will it die off with many of the other Google experiments? I am not sure but I bet you many of the hotel search engines are a bit worried.

Related Stories:

• Google Expanding Its Hotel Prices Experiment In Google Maps
• First Look: Hotel Price Ads In Google.com Search Results
• Google Testing Hotel Prices In Google Maps
• Google Overhauls Place Pages, Emphasizes Reviews & Kills Citations

Adding to the interest, in March, Google announced an option for national advertisers to take advantage of click-to-call through phone extensions regardless of the mobile user’s location—a physical address within the AdWords listing is no longer required. This is a huge opportunity for marketers, especially national advertisers that are experimenting with mobile advertising and remain focused on transparent, performance-based solutions.

Borrell Associates says location-based mobile spending will top $4 billion in 2015, and Google reports that already more than one-third of mobile searches have local intent. Our internal data tells a similar story with more than one-third of all calls to local search ads being made from mobile phones. With Google click-to-call, national advertisers can tap into those mobile-browsing consumers and direct mobile calls to call centers and field offices.

Validating the offline-online and mobile connection

While search monetization for Google has always been about clicks and measuring online activity, the click-to-call move validates the complementary relationship between online search and offline consumer purchasing behavior. Research from comScore and TMP Directional Marketing shows that more than 83 percent of consumers search online and then contact a business offline, often in the form of a phone call, proving that online drives offline, and clicks and calls go hand in hand. Add mobile to this equation and Google recognizes a revenue opportunity in tracking the connection between mobile searching and the resulting calls. With click-to-call, Google can more effectively prove mobile advertising value.

The nuances of click-to-call and pay-per-call

While Google’s click-to-call offering could be confused with pay per call, Google’s offering is still click-based. Click-to-call doesn’t automatically translate to pay-per-call. With Google’s model, calls are tracked and charged as clicks. It is a complementary model on the mobile device but advertisers will still pay per click. In fact, Google is leaving money on the table with this approach as publishers, agencies and online providers usually price calls separately and higher than clicks. However, the move reinforces the need to track consumer online-offline searching and buying patterns.

So why has Google adopted click-based pricing for calls, when industry experience demonstrates calls can be monetized at higher levels than clicks? It is most likely a way to keep the mobile model simple for advertisers that are familiar with paying for clicks while still developing a revenue stream that accounts for the mobile/offline connection. Advertisers already comfortable with Google’s pay-per-click program will find that mobile click-to-call is a natural extension.

Calls: What’s the big deal?

What is so fascinating about calls, especially for search marketers? For over a decade now, advertisers have been accustomed to purchasing online advertising in the form of clicks. Clicks demonstrate visibility and interest, but calls have a direct correlation to offline sales activity. Advertisers and businesses rely on calls to keep the doors open and the lights on; they are a highly valued consumer reaction for advertisers of any size.

A phone call means an opportunity to sell. The mobile search connection—with a phone in hand—actually levels the playing field for the online directory based publishers that compete with pure-play search engines like Google as they already have call-based performance models in place.

What is missing from the click-to-call offering is true call response data, from caller demographics to call duration to dropped calls and more. This type of marketing intelligence is key for advertisers already using call-based metrics. Another challenge that remains to be seen is what this model will do to click prices. Will national advertisers flock to the Google click-to-call model in droves and effectively out price many local advertisers? Will Google use the click pricing temporarily while it builds critical mass? Time will tell. The bottom line is Google’s move reinforces advertisers desire to track online-offline searching and consumer buying patterns across mobile, online and traditional advertising mediums.

Google sees this an an opportunity to attract more display and brand ad dollars online and to boost revenues on that side of the house, where there is much more room for growth than in paid search (at least in the US business).

Some version of an “exchange” has been around for awhile at DoubleClick but mostly under the radar. However with this formal launch or relaunch Google is late to the exchange party. Yahoo with its acquisition of RightMedia in 2007 and Microsoft with its parallel 2007 acquisition of AdECN have been actively in the exchange business for a couple of years.

There are a number of others too calling themselves exchanges, including ADSDAQ, Traffiq, even AdBrite characterizes itself as an ad exchange. Indeed there may be as many as eight or more “exchanges” operating today in online display advertising. That compares with almost 400 “ad networks” of one sort or another. The promise of an exchange is greater efficiency, greater transparency, broader reach for advertisers and better yields for publishers.

Google says that it has been working hard for the past couple of years, since the DoubleClick acquisition closed, to integrate the companies’ technology toward these goals. It says it already has the majority of the top 25 online display networks signed up as well as major newspaper publishers, magazine sites and others. There’s no exclusivity dimension so publishers theoretically can participate in the DoubleClick exchange and other exchanges. But the point of an exchange is to get access to what amounts to the whole market rather than having to go from place to place to fill inventory or buy audiences.

Google says the DoubleClick exchange will be “seamlessly integrated into the AdWords platform and AdSense on the publisher side.” Here’s how Google describes the process and the benefits:

The new DoubleClick Ad Exchange has been rebuilt using Google’s technology and infrastructure. It contains a wide variety of key features that will help improve returns for advertisers and enable publishers to get the most value out of their online content.

On the “sell side”, participation in the new Ad Exchange is designed for major online publishers. It already includes a wide variety of large premium publishers including newspapers, large portals, entertainment and branded sites. In addition, ad space on Google’s third party AdSense publisher sites, representing over 76% of U.S. online audiences and 73% of global online audiences**, is being made available through the new Ad Exchange. This will increase the volume of quality display advertisers available to Google’s AdSense publishers.

On the “buy side”, the new Ad Exchange is designed for ad networks and agency networks – companies that connect web sites with advertisers. It already includes over 40 ad networks across North America and Europe, including most of the 25 largest ad networks in the US*, with more now to be added. Additionally, AdWords advertisers will be able to run ads on sites in the AdExchange, using their existing AdWords interface.

Features of the new Ad Exchange include a completely new interface; a “real-time bidding” feature to allow ad networks to use their own technology to bid on an impression-by-impression basis; a “dynamic allocation” system, which automatically generates online publishers the highest return for every impression by allocating ads to the highest-paying sales channel, based on real time data; more granular publisher and advertiser controls; payments and clearing managed by Google; and a new API to allow ad networks to extend the functionality of the Ad Exchange.

As a basic matter, to gain access, publishers need to be on a Google ad server, especially DART (the system’s not compatible with OpenX or Altas for example). And though the system uses a real-time auction for each impression, large publishers may set a minimum reserve price. Smaller, existing AdSense publishers will not be able to do the same but Google says that increased competition for their ad inventory will boost CPMs.

Invoicing and payments will be uniform and greatly simplified for both sides according to Google. And the tools will all be integrated and accessible through the AdWords dashboard.

In terms of Google’s display ad strategy — an arena where it has the potential to realize the most growth and new revenues — there are really three (or four) components: new and improved display ad formats for the content network (and integrated into search in some cases), video on YouTube and via Google TV Ads and this new ad exchange. Given Google’s reach, influence and footprint, this could turn out to be a huge new arena for the company.

Danny may weigh in on this point but on the call with Google we were struck by a kind of “bifurcation” between the way that large and smaller publishers are handled in the system, vis-a-vis transparency and minimum pricing. Larger publishers in the exchange will have complete transparency in terms of understanding Google’s share/commission on transactions. Whereas small AdSense publishers remain largely in the dark about the revenue split and won’t be able to set a reserve price.

Putting that aside, and others may have more to say on that point than I, with this announcement Google has joined the battle for display advertising dollars in earnest and signaled its intention to be a major player.

Call it an effort to put “Humpty Dumpty back together again.”

Google for its part had once seen itself as a kind of media dashboard, through which agencies and advertisers could efficiently buy not only search but online display and traditional media ads such as print newspapers, radio and TV. Under the pressure of the recession the print newspaper and radio ads programs have been killed. But Google TV Ads remains.

Now as the Wall Street Journal reports Google is testing a program that allows advertisers to make a single buy that runs their ads on conventional TV as well as online at YouTube and potentially across the internet on other sites.

Google’s director of television ads, Michael Steib, said in an interview that the company is working on technology that allows advertisers to buy ads across Google TV, which sells on-air commercials; YouTube; and video on other Web sites through the same interface. Google is testing the service, called Google TV Ads Online, with a small group of advertisers, he said. People familiar with the matter say the service — which would leverage Google TV’s targeting technology — is likely to be introduced in the coming months.

The company is hoping that the new service will make it easier for bigger brand advertisers to spend across both services, which are under pressure to ramp up their business despite the sour economy.

But the feature is also part of Google’s bigger vision of tying together various platforms to make it easier for advertisers to manage and measure their spending across traditional and online media

Conceptually this is the right approach and it should be desirable to marketers who want both reach and targeting. The online component would also theoretically benefit from Google’s new behavioral targeting. But mechanically it faces challenges as the WSJ explains:

For the new effort to work, YouTube needs to secure longer-form video such as TV shows and movies, for which users are often willing to tolerate longer ads. While it is in talks with major media companies, YouTube to date has only signed a small number of full-length content deals with companies such as CBS Corp.

Whether Google TV advertisers — many of whom are just experimenting with the service — will take advantage of the online video integration remains to be seen. Some TV ads may not be suited to run before or alongside online video.

My guess is that only ads of a certain duration — say 10 seconds — will be able to effectively participate in the program. Alternatively, advertisers could have a longer conventional TV version and a shorter online/mobile version.

Mike Blumenthal: What was the goal of the upgrade? What prompted the change?

Carter Maslan: We wanted to address usability issues to make it simpler to get through the process and having it flow on a single screen was a big driver.

Usability was the main motivator… simple things like not a big enough map to be able to accurately move the pin, having a clear sense of where you are in the process, etc. We were trying to address the flow through the enrollment to make it as fast and simple as possible.

What do you perceive to be the greatest improvements from the new interface?

We do a combo of usability studies in labs and monitor actual usage and user success rates. We look at both and try to improve the overall process. This was the first refresh of the UI in a while and was intended to pick up high payback UI changes.

There were a lot of complaints in the Maps groups over the past 10 days. What was up?

All things will be fixed very very soon and those things not yet fixed should be OK within days. We were not able to replicate the bulk upload problem. But all problems [with the new Local Business Center] should be reported into the Maps Group and we will take a look.

The Maps team read the posts about problems on the local blogs and in the groups but their heads were down. The team fixing the problems were totally heads down… so no one was available to give answers in the group.

The main point is that even if we need to work on proactive communication, the team is paying attention, and will try to do better on the communication.

Was there a change in listing policy? The Pin is now required on all single entries? What precipitated that change?

We are experimenting with how much verification vs. how much ease of use. There are variables as to when to prompt… In the past it had been too liberal, and is becoming more stringent. We are experimenting on the quality of the listings and spam. There is no hard yes or no answer to the correct structure.

Will there be some accommodations to facilitate entry for agencies and such? Will there be something like a Trusted Partner status?

We are contemplating something like the letter of agency policy for cell phone companies… we are fleshing out the details. We are interested in coming up with a way to allow people with good intentions to do so, for both bulk uploads and multiple singles entries.

We initially are looking at it primarily geared toward primary sources—like a chain. How do we make it easier for the chain to control the records even if there is conflicting info from a secondary data source?

The first step is for to us to provide simplified verification for use by primary data providers like a national business or chains. Whether it extends to other aggregators or agencies is in discussion.

We hope to have this available soon… less than a year and maybe as soon as a quarter. We are working through the process.

Are there short term efforts to integrate analytics and AdWords?

I am not on the AdWords team. We do have joint discussions on how to make everything simpler. The auction concept is difficult and there are discussions on how to simplify and to maximize an ad campaign. But for now we will stay dedicated to getting basic listings up and running.

Is there a plan to roll out the new Local Business Center interface to the international market? What is the time frame?

We want to work through the kinks in U.S. first and then do localization, but it will go as soon as things are ironed out… less than a quarter.

What percentage of total listings in Maps have been controlled by the businesses or their proxies in the Local Business Center?

No real numbers to publish… individual businesses [with entries in the Local Business Center] are in low seven figures and are growing well.

Coupons seem to be the poor step-child and they don’t get broad exposure. What are the plans for coupons?

We are talking about options to increase discoverability. One of the things being discussed, for example, would be coupons as another attribute and being able to filter on them like by neighborhood or rating.

Was there a significant increase in Maps traffic due to the increased links in the Local 10 Pack?

Part of the increase is growing awareness that users can find more local business information… awareness was a boost in and of itself. It did increase traffic.

Now that you have seen the pattern of many types of spam, is there an effort to clean out old spam in Maps?

We didn’t want to overbuild before the problem was significant, but will go back and purge bad data.

Mike Blumenthal is a student of life, political economy and local search. He writes the blog Understanding Google Maps and Yahoo Local Search and is a partner in a small web design company in upstate NY.

When I asked how many people agreed in the audience, only a few hands went up. James Lamberti of comScore then presented evidence to argue that search was in fact a powerful branding medium because of its reach, how it’s used by consumers in early stages of purchase behavior, the brand and generic category keywords used in queries, and so on.

Yet if one could persuasively argue that search wasn’t truly a branding medium before, it will become one in a much more obvious way in the very near future. Witness Barry’s post on Yahoo’s effort to put branded Honda advertising at the top of search results. Here’s the ad as it appears on Yahoo:

And here’s a video that plays over the search results when clicked:

The other interesting angle here is that TV drives the search behavior (through a prompt to “Shop Honda”) then provides for a full range of user responses and actions depending on that particular consumer’s place in the so-called purchase cycle: find offers, locate a dealer, request a quote (lead-gen).

Through Yahoo search, Honda can track the efficacy of the TV campaign (via query volume) and all the other actions the user takes, right down to the point of sale potentially. There is also a range of pricing/ad models that may be possible here: CPM, CPC, and even CPA, depending on the user action, within the same ad unit.

Google is also bringing display ads in the form of video into search. The video ads on Google will be like video in Universal Search, activated by the users and potentially “behind” a plus box.

These ads show the future of search marketing for big brands, as the engines acclimate users to seeing graphical and video ads in search results. Universal or blended search is paving the way. As Google’s Marissa Mayer said when Universal Search launched:

Well we don’t have anything to announce on that today. I do think this opens the door for the introduction of richer media into the search results page. We are now going to understand how users interact with that. And as Alan always likes to say search is about finding the best answer, not just the best URL or the best textual snippet.

For us ads are answers as well. Searching ads is just as hard as searching the Web, as searching images. And so I was hoping that we could bring some of these same advances in terms of the richness of media to ads.

Brands and agencies will welcome these ad offerings, consumers will likely respond to them if they’re not too intrusive, and ad networks should fear them because they will be far more effective for brands in the long run.

Armstrong, who is President, Advertising and Commerce for Google in North America, was speaking at the American Association of Advertising Agencies Media Conference in Orlando, Florida. Here’s the description of Armstrong’s session: Why Google Is Not Out to Disintermediate Agencies Google has the fifth highest market capitalization, after only nine years of existence. Tim Armstrong, Google’s North American president for advertising and commerce, will talk about the company’s plans for getting everywhere as soon as possible, and will try to convince a skeptical audience that Google will not disintermediate agencies.

What Armstrong outlined in the talk was a Google media buying and planning “dashboard.” According to MediaPost:

“It basically takes a mix of different media types and puts them together,” he said, adding that the system, which is still being developed, was part of a suite of new tools Google is building to make the lives of media buyers “easier.” The new dashboard, he said, would enable buyers to manage mixes of offline media like TV, radio and print campaigns, with their online display and search advertising, and to harness their data streams to show how one platform influences traffic to the others.

The deep level of ad-agency integration that this implies would presumably enable Google to capture a larger slice of the brand advertising pie. However, several factors might conspire against Google in this scenario:

• Agency fear and/or resistance

• Agency development of a competing system that accomplishes the same objectives
• The possibility that media buying cannot be automated to the degree Google assumes

Silicon Alley Insider also captures another level of potential resistance: “Google wants to be your media planner. And your research department. All functions that make up a big part of the giant ad conglomerates already.” In other words, these are bread and butter agency functions that bring in revenue.

Regardless, there’s a kind of “inexorable” logic to the Google cross-media dashboard. For the past several years, Google has envisioned itself as a more efficient way to buy media across the full range of advertising platforms and has very self-consciously been moving toward this goal.

When Kim Malone was questioned on how Google plans on taking the “non-intrusive” nature of search ads and contextual ads to the TV ad model, she said, “it’s going to evolve in a way that is less annoying to you and me.” She explains that by “inviting” the user to view your ad, as opposed to forcing them to see the ad, will help.

Malone explains that Google video ads are only played when someone actually takes an action to click on the ad. Google is able to track the number of ad views and if someone stops watching the ad midway through. Those metrics are valuable to advertisers, Malone said. It helps typical brand advertisers understand that they really “don’t want to annoy people.”

Nicholas Carlson of Internetnews.com ends his article with, “It’s hard to say if they want to or not [give the consumer an option to see an ad]. The good news is that they might not have a choice.”

Google, which is known to be interested in in game ads, has filed a patent application that Bill Slawski explains as:

Google looks at ways of determining user information for use in targeting ads, and determining and serving relevant ads in video games. They take into account a person’s interests and gaming behavior by monitoring and making inferences from their online gaming activities.

The Open Rights Group said, “I can understand why they are interested in this, but I would be deeply disturbed by a company holding a psychological profile.” The Guardian explains that Google can learn a lot about a user within one of these online role playing games such as Second Life. Google would love to show ads that are relevant to the user.

The Guardian spoke with Google, which said “it did not have any plans to roll out the technology in the near future.” When and if Google launches these ads, I am sure there will be a spark of controversy at the onset which will die down over time.