The online marketplace dabbles in advertising on messaging app Tango, which discontinued its in-app shopping tab to focus on advertising.

Tango is now dancing with eBay.

The mobile messaging app with almost 400 million global users continues to focus on making money through advertising after shuttering the shopping portion of its app, TangoME Inc.’s CEO Eric Setton says. Among Tango’s thousands of advertisers, Setton says 10% are retailers, and online marketplace eBay Inc. is experimenting with advertising in the app.

“Our objective is to be where our users are, and today more often than ever, that’s in social and messaging apps” says Llibert Argerich, global director, social and content at eBay. U.S. adult smartphones users spend four hours and 39 minutes on communication apps each month, according to Nielsen Electronic Mobile Measurement, which is part of audience measurement firm The Nielsen Co.

Most-used Android messaging apps in the U.S.
(measured by current app install and usage information)

1. Facebook Messenger
2. WhatsApp Messenger
3. Kik
4. GO SMS Pro
5. Imo free video calls and chat
6. Viber
7. LINE: Free Calls & Messages
8. Skype – free IM & video calls
9. Messenger (published by Google Inc.)
10. GroupMe

Source: Similarweb, a web analytics company. As of August 2016
SimilarWeb creates its usage ranking by using an algorithm based on current installs and active users within the last 28 days.

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EBay advertises on three other messaging apps—Facebook Messenger, Kik and Snapchat—advertising on a total of 17 social media and messaging apps, Argerich says.

Tango’s large user base and user demographics attracted eBay to advertise on Tango, Argerich says. More than half of Tango users are women and about a third are ages 25-33. EBay in May launched a pilot program to advertise on Tango and is in the process of setting up its next campaign on the app.

EBay is experimenting with Tango’s ad units, which include chat ads, native ads, profile ads and discover ads. The name of the ad describes where the ad is placed in the app. For example, when eBay uses a chat ad, eBay’s display ad will be listed among a consumer’s list of friends she is chatting with. 

In a native ad, an eBay advertisement will appear within the context of Tango’s newsfeed. For a profile ad, eBay’s ad will appear at the top of a Tango user’s profile. A discover ad is used when a consumer is flipping through possible people to follow on Tango, much like swiping on the Tinder dating app, and an eBay ad is featured as “someone to follow.” The discover ad will display an eBay product that a consumer can tap to go to eBay’s mobile site.

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EBay would not specify how the Tango ads perform, but Argerich says other messaging app ads have been successful. “Everything we do has a tie to return on investment,” he says. “The fact we are continue to work on Kik and have an ongoing relationship with Tango is a sign it’s working for us.”

The cost for the ad units is “on par” with what other messaging agencies charge, Argerich says without revealing specifics. Tango would not disclose rates.

The Tango app is used in 224 countries and U.S. consumers are the largest geographic group, at about a quarter to a third of users, Setton says. The app does particularly well with Spanish speakers in the United States, he says. He attributes this to Tango providing access to free international calling and the name of the app. Tango, which launched in 2009, also was one of the first video calling apps on the Android operating system, Setton says.

Tango launched e-commerce capabilities in the United States in May 2015 with more than 2 million products listed for sale from Wal-Mart Stores Inc., No. 4 in the Internet Retailer 2016 Top 500 Guide, and from AliExpress, a global consumer retail marketplace owned by China’s massive Alibaba Group Holding Ltd. On AliExpress, manufacturers and wholesalers based in China sell products directly to consumers outside of China, including in the United States.

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Sales after five months, however, were not enough to sustain the e-commerce push. Tango discontinued the feature in October.

In February, Tango made changes to “bring the company closer to profitability,” Setton says, which included reducing staff to 150 employees from 200, and spinning off a social media-focused app into a separate app called Fiesta.  

Tango continues to add more features to the Tango messaging app to help differentiate it from over the top communications apps, which are apps that allow consumers to send two-way communication like a text message via Wi-Fi instead of using data from a consumer’s wireless carrier. For example, consumers can play a game together on a call, and the Tango app automatically shows a consumer her smartphone photos asking her if she would like to share them with the person she is corresponding with.

Tango is headquartered in Mountain View, Calif. The company has raised $367 million in venture capital financing and has offices in Austin, Texas; St. Petersburg, Russia; and Beijing. Besides advertising, Tango also make money by charging content creators, such as those for gaming apps, to distribute their services and goods via the app. 

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