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Yahoo is testing app install advertisements to promote targeted apps, in an effort to catch up in the growing and lucrative mobile ad market.

The move follows statements made by Yahoo chief executive Marissa Mayer for over a year: “Yahoo’s future is mobile.” Yahoo was considered a leader in mobile years ago, but has since fallen way behind competitors such as Google and Facebook.

A Yahoo spokesperson told VentureBeat Monday: “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.”

The spokesperson did not say who the first group of advertisers are.

The mobile advertising market totaled $13.1 billion in 2013 according to Gartner, and analysts say that figure will exceed $40 billion by 2017.

Adam Cahan,Yahoo’s senior vice president for mobile and emerging products, did not respond to an email for comment Monday.

Yahoo has a lot of catching up to do as they move away almost solely from the desktop advertising space they largely dominate and into the burgeoning mobile arena, said analyst Ben Bajarin with Creative Strategies.

“They’re certainly behind in mobile. They are not at the forefront. The challenges they face is a customer-based challenge. I think they get it that they can’t be a desktop-based company but a mobile company in order for them to survive,” Bajarin said.

The Yahoo spokesperson put it this away:

“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.”

“They need to move away from the desktop legacy mentality. And quickly,” Bajarin said.

Mobile ads pose uniques challenges that desktop ads do not. Namely size. Smallish mobile screens make it harder to capture the focus and interest of users.

Yahoo unveiled Gemini in February.Yahoo characterized Gemini as “the first unified ad marketplace for mobile search and native advertising.”

In a post, Yahoo said: “When advertising appears seamlessly and naturally, it creates a more enjoyable experience for users, increases engagement, and improves performance for advertisers. This is why we continue to work hard to roll out new, more innovative native ad formats on Yahoo.”

Innovation at Yahoo is what could well be the aging tech company’s saving grace, Bajarin said.

“You have to be in mobile to make money. It is about innovation. And that’s what will help them get back to center stage. And if not, they’re going to be small player in a quickly growing market,” Bajarin said.


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