Yahoo Is Testing Ads Which Sell You On Apps

Yahoo has a strategy for making money on smartphones: The company is reportedly rolling out ads which prompt users to download other apps across its mobile properties.

Mobile app-install ads are an increasingly popular way of making money off of mobile websites and apps. They typically appear in streams of content and help drive downloads to mobile applications. For instance, if you’re playing an online sudoku game, you might see an advertisement to download another game which directs you to purchase it in an app store. In most deals, publishers get paid for every download they drive.

Yahoo confirmed the move to ReadWrite.

Brands With Apps (And Money)

“We’re testing in-stream ad opportunities with an initial group of advertisers who have mobile apps and want to connect directly with audiences across Yahoo mobile apps and sites,” a Yahoo spokesperson told ReadWrite in an email. “The purpose of these native ads is to help brands drive downloads of their mobile apps. These tests will begin to appear across all of our properties where in-stream ads run on iOS and Android devices.”

In-app installs are a particularly valuable way to reach an audience, as mobile users already established their willingness to download apps. Facebook and Twitter, among other companies, have tweaked their mobile apps to accommodate app-install advertising.

Yahoo CEO Marissa Mayer has focused the company on its mobile services, and app-install ads are likely a small piece of a much larger push into mobile—which includes other ways of helping app developers drive downloads.

Earlier this year, the company acquired Aviate, an “intelligent homescreen” that customizes the mobile experience by learning which apps you use the most and at what time of day. And as Kara Swisher recently noted on Re/code, Yahoo may be able to create mobile search experiences which feature apps, thanks to an exemption to its otherwise broad-ranging search partnership with Microsoft.

Facebook said that mobile app ads drove more than 145 million installs in 2013. Mobile advertising revenue accounts for 53 percent of the company’s total ad revenue, and the company has said app-install ads are helping drive growth in mobile revenues.

A History Of Failure

One concern developers might have: Will Yahoo stay committed to this new distribution platform? Yahoo’s past history with developer-oriented services may haunt it.

Even as it launches a mobile platform to help app developers find new users, Yahoo is shutting down a similar service which helped desktop-Web app developers. The Yahoo Application Platform, used to build games and other services for My Yahoo, is closing at the end of the month, according to a notice posted on Yahoo’s developer website.

Back in 2008, these Web-based apps—built on older technology and not related to Yahoo’s current mobile-app push—formed the basis of an attempt to redesign Yahoo’s homepage and feature third-party services, AllThingsD reported at the time.

But these so-called Web widgets didn’t prove popular with consumers. Google also closed a similar service, iGoogle, in November.