eBay Inc. (EBAY) is ready to launch an advertising network for its mobile app in the last quarter of this year. This will allow advertisers to connect to the app’s 4.6 million daily users.
eBay’s head of display advertising in North America, Howard Sarin, is reported to have said that customers spend 3 times as long on its app than its closest competitor.
The new network will help advertisers identify their target customers as the app requires a log-in, enabling eBay to know about its users’ activity within the app.
For eBay, the mobile ad network could possibly be a new avenue for revenues.
However, this new venture has its risks. It might direct possible buyers away from eBay, to rival retail sites.
eBay has teamed up with Triad Retail Media to place the advertisements. The revenue generated from advertising will be shared between the two companies. Though eBay did not disclose the terms, it did mention that it would be getting the larger share.
eBay has already secured a few advertisers including Berkshire Hathaway’s Geico insurance unit.
Market researcher eMarketer estimates that worldwide spending on mobile advertising will grow almost twofold this year.
eBay carries a Zacks Rank #3 (Hold). .A better ranked stock in this industry is Mercadolibre Inc: (MELI), which sports a Zacks Rank #1 (Strong Buy).