Web ads served to iPhones draw 10-20 times more clicks

“The wall between online advertising and mobile advertising has cracked,” according to ad network executive Michael Chang. Chang’s company, Greystripe, has been testing a partnership with Web ad network Tribal Fusion. In the past six months, Tribal Fusion has passed along more than 500 ad campaigns to Greystripe, which re-encodes them to play inside games on iPhones.

The result may surprise even mobile-tech utopians: The mobile versions of the exact same ad performed 10 to 20 times better — in terms of click-throughs by those who saw them — than the versions that Tribal Fusion had served to browsers on desktops and laptops

The takeaway for advertisers: You don’t need to create a separate ad for phones. Your Web ads will do just fine.

In a lengthy phone interview with Chang, his key talking point, which he came back to often, is that mobile ads are not much different from Web ads. “They think that mobile is somehow different,” he said of ad buyers. “What you’ll be seeing is that while mobile has some unique attributes — sure, it’s a personalized device that people trust more [than a PC] — a mobile buy is the same as a digital buy,” industry jargon for browser-served ads.

Then why the higher clickthrough rates? “On a phone, the ad gets the whole screen,” Chang said. “It’s like when you see two-page ads in the Wall Street Journal.” In ad jargon, Greytripe’s ads have a 100% share of voice while they’re onscreen. There’s nothing else to look at.

The user has the option to skip the ad. Still, more than 1 in 100 choose to play with the ads instead.

Mobile ads spun from browser-based media aren’t new. Google already serves its AdWords ads to mobile phones and recently bought top ad network AdMob.

But Greystripe isn’t serving search-targeted text ads. It’s serving image-driven display ads, as the industry calls them. They’re meant to be seen and to be watched, whereas Google ads are meant to seduce search engine users to click through and buy something, or at least to go look at something on another site supported by yet more ads.

Display ads are mostly used for branding — think of Burger King’s goofy TV spots with the King — and for awareness-building such as Yahoo Mobile does with its Web ads. “The goal of a display ad is more like a TV commercial,” Chang said, as opposed to the buy-now mission of search ads.

Greystripe’s corporate site has a page full of sample ads served to iPhones. They come from the Web standard 300×250 square ads seen all over the Internet. (Separately, Greystripe also serves interactive ads to Android phones, and serves non-animated 300×250 ads to less powerful phones.) Expect to start seeing lots of them.

Chang founded San Francisco-based Greystripe in 2005. The company, which counts just over 25 employees, has raised more than $18 million in three rounds of funding. Most recent was a $2 million investment from GE/NBU’s Peacock Equity Fund, capping a $7.5 million third funding round. Disney’s Steamboat Ventures, Incubic Venture Capital and Monitor Ventures invested $5.5 million of this round in March 2009.