How Priceline became Google’s $1 billion advertising buddy

Priceline.com Inc. has boosted annual ad spending to more than $1 billion for the first time, extending its lead over Expedia Inc. in the hotel-booking market and stepping up a rivalry that’s benefiting Google Inc. Even as social-networking services Facebook Inc. and Twitter Inc. capture a widening share of the Web-advertising market, the top online travel agents still choose to place most of their ads on search sites, where consumers can quickly compare prices and complete a transaction in a matter of clicks. “One of the secrets to Priceline’s success has been its ability to manage search campaigns,” Mark Mahaney, an analyst at RBC Capital Markets in San Francisco, said in an interview. “There is a major new marketing war going on between Priceline and Expedia, and Google is the beneficiary.” Priceline, fueled by its Amsterdam-based Booking.com unit, has more than tripled spending on Internet advertising to $1.27 billion in the past three years. About 90 percent o