AdMob eyes Japan’s mobile advertising market

In a rare occurrence a Silicon Valley-based startup is getting ready to enter Japan’s mobile market, well-known for its technological advancements and tough competition. However, founded in 2006 AdMob has already gained confidence in providing marketers and publishers with advertising platform targeted at mobile users. At their website, AdMob folks claim to be serving over 1.5 billion targeted ads each month in over 160 countries.

The reason to go into Japan may be that while showing a great future potential the US mobile ad market is still in the early stage of development with just such mavericks as mobile-focused AdMob or Internet players like Google and Yahoo exploring the unknown world of mobile marketing, while traditional ad agencies prefer to wait and see what happens. However, while mass-market ad agencies are slowly warming up to the idea of mobile advertising, the 10% of online marketing budgets in Japan is already being spent on mobile ads.

The first entry into the non-English speaking market by AdMob is scheduled for February. AdMob have already translated their website into Japanese and reportedly beta tested the local ad platform. The first half of 2008 will be dedicated to tuning their ad platform up to Japanese market standards and building a client-base that will first consist of small and medium-size companies. Having built a core client base and proved its case AdMob plans to expand by attracting bigger accounts.

In Japan, AdMob will face a tough competition not only from big players like Yahoo! Japan but from domestic established mobile players as well. For instance, D2 Communications, a mobile-marketing company partly owned by Japanese wireless company NTT DoCoMo Inc., has been delivering banner advertisements on cellphones since 2000. To get local advertisers on board AdMob needs to come up with appealing value proposition, which might include more generous revenue-sharing model.

Will AdMob have enough time to become successful in Japan or not, in a short to long view, they are likely to become an acquisition target in the US. However, the foray into Japan’s market, if successful, may add attractiveness for global players who look for a quick way to get into international mobile advertising markets.

Related article: Japan mobile ad spending up 59.2% in 2007

Source: CNet Japan