Startup make ads personal

If the name AdMob doesn’t ring a bell, it soon will.

The two-year-old San Mateo startup, which operates the world’s largest mobile advertising marketplace, is in the process of making ads a lot more personal.

 In fact, Admob is so good at serving ads to the Web sites accessed by cell phones and PDAs that it can count as its clients such companies as Disney, Starbucks and Coca-Cola. Even big-name competitors like Google and Yahoo — which run their own mobile ad services — are faithful customers. “That says a lot,” said Jason Spero, vice president of marketing for AdMob, which has more than doubled in size since March, and is looking to hire 15 new engineers. “The pace is amazing … how fast we’re growing.”

It’s no wonder. There are now more mobile devices in the world than personal computers and televisions combined. Some 15 percent of mobile subscribers use their devices to access the Internet — that’s about 32 million unique users, a sizable chunk of which comprises the coveted 18-34 age demographic.

So what’s the secret to AdMob’s success? Huge amounts of data, for one. In September, Admob had filed approximately 1.6 billion ads globally. By using the data from its ads-served to describe the behavior patterns of mobile Web-browsers, “We can identify the most relevant ad for a specific context,” Spero said.

This allows a customer like ESPN to precisely name its desired audience — say, visitors to its NFL site on Motorola V500’s in the United States whose carrier is AT&T, and during the time of day when 13-17-year-olds are most likely to be browsing. ESPN’s server then reaches into AdMob’s huge bag of ads and is handed the most relevant one.

Those ads are bought and sold on AdMob’s self-serve Web site. “a la eBay,” Spero said. They appear in unobtrusive banner and text form, and the ease with which site-providers buy, and advertisers sell, the ads helped precipitate AdMob’s meteoric rise. Indeed, founder and CEO Omar Hamoui left business school to focus on running his MBA-project turned company.

Good thing he did. Established Internet companies are crashing the mobile ad party en masse. After last year’s dip in Internet advertising revenues, the industry is back to setting records — nearly $10 billion for the first half of ’07. But the Internet ad market is established and ultra-competitive, unlike the mobile ad market. Some sources project mobile ad revenue of $11 billion by 2011, and annual growth of mobile users is up to 40 percent.

In August, Yahoo! bolstered its mobile ad position by snapping up Actionality, another mobile ad startup. And in September, Google launched AdSense for Mobile, a mobile version of its Internet ad serving program. Just like AdMob, it allows mobile Web sites to make money on their content through advertising. But these companies have some catching up to do.

AdMob has already cultivated an international sales force, and has just recently launched a unit devoted entirely to Apple’s iPhone. With a two year lead-time, and a healthy outlook — “We’re having too much fun to be bought by a big company,” Spero said — AdMob looks likely to remain king of the mobile ad hill.

Who knew its offices were on San Mateo’s Third Avenue?

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