Conversion tracking tools provided by ad platforms like Facebook and AdWords allow businesses to monitor user actions on their websites after clicking on ads. By adding a unique pixel ID provided by the ad platform to specific webpages, businesses can track and measure conversions, such as purchases or sign-ups. This data helps optimize marketing efforts by identifying successful ad campaigns and understanding customer behavior. 

Using short URLs with pixel ID integration simplifies the process of adding the pixel to the website. However, businesses must consider privacy regulations, implement the pixel accurately, and ensure cross-platform compatibility for reliable tracking. Regular analysis of the collected data aids in making informed marketing decisions and improving ad campaign performance.