There have been a number of studies that show that online display advertising has a multiplicative effect on conversion rates of sponsored search listings – as high as 22% improvement. (See Microsoft Advertising Institute.) But it’s still hard to tell exactly how much impact your specific display ads have on your specific search campaigns.

That should be changing soon, though. As Advertising Age is reporting, Google is beta-testing their Campaign Insights tool, which will give you an indication of how effective your campaign is. As they explain:

With Campaign Insights, Google takes data from the advertiser’s server logs to determine who was shown an ad and when. Then compares that to web searches and site visits culled from data from the millions of Google toolbars on computer desktops. Those results are compared to a comparable group that didn’t see the ad.

Then Google measures the difference between the number of brand searches and site visits between the two groups. To filter out the impact of other media or influences, such as a TV campaign, Google compares the data to the two groups’ behavior before the campaign began. The incremental difference is attributable to the display-ad campaign.

This should be a win-win for both Google and marketers. Marketers will be able to refine display advertising campaigns for better effectiveness and Google will gain more of the display advertising business (because they will be able to objectively show the ROI of campaigns).

Domus is a full-service advertising, PR, and social media marketing agency based in Philadelphia. Please visit us at http://www.domusinc.com.