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Google's Chief Economist on Data and Ad Strategy

I'm reporting from the Ad Age Digital conference in Manhattan, where Google Chief Economist Hal Varian spoke about the role of data in ad strategy. Varian is Google's chief number cruncher, the guy who sorts through the limitless piles of data and figures out what matters and what doesn't.

Varian believes that measurability is the number one most important thing in making ad decisions.

A tight feedback loop — the ability to respond to what works and doesn't — is also key. I asked about Steve Jobs' comment that the search model is less relevant in mobile. Varian dismissed Jobs' concerns, saying people do search on their mobile devices, and often when they're doing something else, like watching TV.

And today we couldn't stay away from Twitter.

Varian was positive about Twitter's model, which relies on the power of referral.

Is Google working that element into its system? He says they're looking at it.

When Varian evaluates data, he's not just planning ad strategy, he's also looking at search terms as an economic indicator. More searches for say, vacations or flights to Hawaii and Europe might indicate that the consumer and the economy are coming back. Varian couldn't get into any of the trends he's seeing now as Google's earnings report is coming up later this week, but he did direct me to this blog he posted about using queries to predict economic activity.

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