Google’s mobile ads are becoming more location-aware. Today, Google is introducing mobile display ads for both the iPhone and Android phones which can be geo-targeted. Advertisers will be able to check a “location extension for display” box and their ads will become geo-enabled when viewed in mobile browsers or apps.  A little double-arrow will open up the ad and show the business pinned on map with two big blue buttons to get directions or call the business.  Google will only charge for calls or clicks.

Google already offers so-called “location extension” ads for mobile search, but this is the first time it is expanding the concept to mobile display ads.  Google says that mobile ads that offer a location generally see an average 8 percent increase in click-through rates over plain-vanilla mobile ads, and click-to-call mobile ads see a 6 percent increase in clicks.

Mobile ads such as these could open up new marketing opportunities.  Seeing a business on a map makes it less abstract. It literally grounds the ad for the consumer.  And the click-to-call option is key.  Local merchants love getting calls from customers.  In addition to targeting by location, of course, Google also targets mobile display ads contextually and by device.