• by Mark Walsh  @markfwal, November 20, 2013

Aiming to restore luster to its display ad business, Yahoo on Wednesday introduced a new high-resolution, full-page ad format for the desktop, mobile phones and tablets.

The Yahoo Image Ads will appear in photo slide shows and “image-rich environments” across key entertainment-focused properties such as Yahoo Sports, omg!, Yahoo Music and Yahoo TV.

Despite being geared toward brand advertising, Yahoo said the Image Ads would be sold on a performance basis -- marketers don’t pay unless a user clicks on an ad. The company suggested it could deliver high conversion rates by matching the right ad to the right user across its network.

“This creates a more natural ad experience for our users that they are even more receptive to, leading to higher impact for advertisers,” stated a Yahoo blog post today. Whether Yahoo can live up to that promise will go a long way toward determining how much traction they get with marketers. Its display business could use a boost.

“These new ads deliver high-quality brand images that are as engaging as the surrounding content, bringing the beautiful full-page ads you might expect from a favorite magazine to the digital world,” it added. A sample ad in the post shows a full-page ad for the Fiat 500L within a slideshow for the 2013 Miss Universe National Costume Show.

The filtered, Instagram-looking image shows the car parked on a San Francisco street surrounded by a pair of couples. The only ad copy is placed within the bottom overlay, where a side show caption might normally be.

In the third quarter, Yahoo reported that display ad revenue fell 7% from a year ago, after an 11% decline in the prior quarter. At the same time, U.S. display advertising overall was up 9% in the first half of 2013, according to Interactive Advertising Bureau data.

Yahoo has also been losing ground steadily to its chief rivals: Google and Facebook. The former will account for 17.6% of U.S. digital display ad dollars this year, trailed closely by Facebook at 15.5%, with Yahoo’s share slipping from 9% to 7.7%, according to eMarketer.

The Web portal earlier this year launched its own native format -- Stream Ads -- that appear in news feeds across its network—but so far those ads have not helped lift its sagging display ad sales. The Image Ads look like an attempt to offer the kind of high-impact display ads Yahoo has traditionally offered, but as a native format for content like slide shows and image galleries.