• by Mark Walsh  @markfwal, February 12, 2007

Yahoo today launched display advertising for its mobile Web service in 18 countries across Europe, Asia and the Americas, including the United States. Ads appearing near the top of the Yahoo Mobile home page will allow users either to click-to-call marketers directly or link to mobile sites for more information on offers.

The Internet giant first tested mobile banner ads in the U.S. last November with Pepsi, which used the service to pitch Diet Pepsi. Other advertisers joining at launch include Nissan, Pepsi, Procter & Gamble, Asia Pacific and Singapore Airlines. "The mobile environment can be frustrating for marketers, so this global platform is just really easy and allows marketers to advertise on most phones around the world," said Elizabeth Harz, vice president, category strategy for Yahoo Media Sales.

Pepsi will run a campaign that drives consumers to a promotional site for its Free Ride sweepstakes awarding Subaru WRX cars and other prizes. Specific campaigns of other advertisers were not disclosed by press time. Harz also declined to provide further details of the ad deals such as mobile display ad rates. But she said Yahoo intends "to be the No. 1 mobile Internet player and No. 1 in mobile monetization."

The mobile ad market remains small for now--only $1.4 billion this year--but is expected to reach $2.9 billion by 2011, according to JupiterResearch. Most of the current mobile marketing efforts are centered on text-based ads. Jupiter forecasts that mobile display ads will only increase to $224 million by 2011, with CPMs declining to $23 from $41 in 2006 on increased inventory.

Currently, around 26.4.3 million mobile subscribers--or 13%--access the Web through mobile browsers, according to media measurement firm M:Metrics.

"Yahoo is one of the more popular sites people go to when using the Internet, so this is certainly the right thing for them to be doing," said Julie Ask, a research director with JupiterResearch covering the mobile industry. One challenge for Yahoo in extending brand advertising to the cell phone, however, is that not every marketer has a mobile landing page yet for direct response campaigns. "If you put up a mobile ad, there has to be a place for people to go to from the ad," said Ask.

Harz noted that Yahoo is talking to other marketers about joining the initial group of mobile advertisers and is pleased with the response the company has gotten from major brands. The company also plans to roll out inventory beyond the mobile home page to other sections of the site in the coming months.

Besides the U.S., other countries in which Yahoo unveiled mobile display advertising include the U.K., Spain, Argentina, Indonesia and Mexico.

Yahoo also announced today the latest test version of Yahoo Go for Mobile 2.0, its package of Yahoo applications including e-mail, search and Flickr photo-sharing for handheld devices. The new version lets consumers search directly for local businesses from interactive maps and share search results and news stories with friends. The upgraded Yahoo Go will also test display advertising for the first time, starting with Pepsi's Free Ride campaign.