Yelp Will Launch Display Ads in Mobile Apps

social networks, social media, recommendations, local search, yelp, foursquare, facebookYelp will launch display ads in its mobile apps this month, with InterContinental Hotels Group (IHG), Taco Bell and Miller Lite as its first advertisers, the company said today.

Yelp currently generates most of its revenue through promoted results in its mobile apps and on the Web. The website, according to the company’s SEC filings, includes graphic brand advertising, but few advertisements appear in basic use cases.

A tiny fraction of the company’s revenue comes from deals it offers on behalf of merchants to users who use the mobile app to check in to venues.

The company is not yet profitable, but its revenue has grown consistently since its IPO a year ago. Nearly half of its searches come from mobile devices.

It remains difficult for many companies to monetize their mobile users.

Yet, display ads are seen by many advertising insiders as a clumsy way to advertise on the mobile devices’ small screens. However, Yelp may simply be testing the waters with simple advertising modules before developing more interactive capabilities.

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