The telomerization reaction of 1,3-butadiene with alcohols to give alkyl octadienyl ethers in the presence of palladium-carbene catalysts has been studied in detail. Unprecedented catalyst efficiency with turnover numbers (TON) up to 1,500,000 and turnover frequencies (TOF) up to 100,000 h(-1) have been obtained after optimization for the reaction of methanol in the presence of an excess of in situ generated carbene ligands. High yields (75-97 %) and catalyst productivities (TON 15,000-100,000) are observed for other aliphatic alcohols and phenols. For comparison five carbene-palladium(0) complexes have been synthesized and characterized by X-ray crystallography. Both electronic and steric effects on the stability and reactivity of the catalysts have been discussed on the basis of density functional theory calculations.