Mobile

Greystripe’s mobile ads break free from their app prison

As the mobile advertising industry grows, most of the attention has focused on advertising inside applications, not on mobile websites. Since the iPhone’s enormous app ecosystem is one of its main draws, it’s no surprise that Apple’s iAd effort is all about apps, but other ad networks have taken a similar route. Mobile ad startup Greystripe was all about apps, until today.

Now, the San Francisco startup is launching a new feature called RevMax for Mobile Web. With it, mobile website publishers can run ads that have all the slickness and interactivity of the Greystripe ads that run in native applications. Those ads use the company’s Lightning Technology, which takes ads created in Adobe’s Flash format and converts them so they work on non-Flash devices like the iPhone.

Chief executive Michael Chang said that until now, the advertising that you’ll find on most mobile websites is just a dinky little banner. By making the ads bigger and more prominent, and incorporating richer media, Greystripe can dramatically increase the clickthrough rates, he said. The company already tested the feature with select publishers, including the IAC-owned sites CollegeHumor.com, Dictionary.com, and Evite.com. The tests showed that smaller banner ads saw average clickthrough rates of 0.56 percent, while a large, rich media ad saw a clickthrough rate of 1.31 percent.

This move seems to fit into recent debates about whether mobile websites or downloadable apps will become the dominant format for consuming content on smartphones. But Chang said Greystripe isn’t choosing one over the other. For publishers like IAC, there are some properties that make more sense as apps, and others than make sense as websites. With Greystripe, you can make money either way, or through a combination of the two. And the brand advertisers that Greystripe works with care mainly about reaching a specific audience, regardless of which phone they’re using, or whether it’s in an app versus the mobile browser.

“The trend we’re seeing is a need to reduce fragmentation,” Chang said.

Greystripe has raised $17.6 million in four rounds of funding, most recently $2 million from Peacock Equity. It says it serves ads in more than 2,500 applications, with “a number of developers” (such as MobilityWare) earning more than $100,000 per month from their ads.

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