Beijing: Baidu Inc launched on Wednesday a service that helps retailers advertise on the smartphones of nearby users as China`s dominant search engine company expands its location-based technology to drive growth.
Baidu currently makes most of its income from desktop-based search advertising and has lagged peers such as Tencent Holdings Ltd in capitalising on the popularity of mobile internet in China, the world`s largest market for smartphones.
It sees real-time, location-based technology as a way to boost advertising revenues from the rise of e-commerce in China, where government data shows more people now access the internet via a mobile device than a personal computer.
"In the mobile era consumer behavior is changing, and the mobile Internet has given us new businesses and opportunities," said Robin Li, Baidu`s chief executive, during the launch of the Baidu Connect service.
The service offers toolkits for merchants and software developers to build online-to-offline (O2O) applications, which seek to attract potential customers to nearby shops and restaurants via promotions and ads displayed on smartphones.
Baidu also said it had recently bought a $10 million minority stake in IndoorAtlas, a company that offers a special technology that allows smartphone users` positions to be tracked inside buildings, which is often difficult due to the metal used in structures.
Baidu`s push into location-based services and O2O puts it increasingly at odds with Alibaba Group Holding Ltd, China`s biggest e-commerce company, and Tencent.
Last week, Baidu announced a 5 billion yuan ($813 million) tie-up with Beijing-based conglomerate Dalian Wanda Group and Tencent to provide O2O services inside Wanda`s commercial developments.
Like other tech firms, Baidu is also branching out into wearables. On Wednesday, it demonstrated its Baidu Eye, which uses a camera to scan objects and then synchs with a smartphone.