Fourth quarter onwards, eBay Inc will begin running advertisements on its mobile app considering the fact that eBay's users spend 150 minutes on its app per month. This time, duration is three times higher than its nearest rival.

The market for ads on devices such as smart phones and tablets is fast growing and quite lucrative as advertising draws much higher margin business than retail, but at the same time there is a risk that this move may draw users away from eBay's site.

According to industry research firm eMarketer, mobile ad spending in the United States will total US$17.73bil (RM56.72bil) this year, up by 83% from US$9.69bil (RM31.06bil) in 2013.

The things that will work in favor of the company in this area is not only the large user base and longer time duration of use but also the fact that the company can better tailor its ads as all its users have single universal login across all their devices.

Berkshire Hathaway's insurance unit Geico will be among the first advertisers on eBay's mobile ad network.

Commenting on the risk of losing potential customers, Stephen Howard-Sarin, eBay's head of display advertising in North America, stated that the company's relationship with users "can survive a blip or two".

He said, "If they respond to (the mobile advertising), we're not so brittle that we think that's going to destroy their relationship with eBay. They're going to come back as soon as they're done and we're not afraid of that".

He added that the company will be building on the success of advertising on the desktop and is bringing it to the mobile experience.

Two years ago, eBay had tested ads but it soon ended the effort after finding that their users' experience wasn't good enough. Now, as more people have started shopping on mobile devices, EBay decided to reintroduce the service to make it more seamless and secure.