PayPal is unleashing its advertising business on the open web.
The company’s ad arm—PayPal Ads—will begin selling programmatic ads to marketers, said Mark Grether, SVP and general manager of PayPal Ads. Grether spoke about the expansion at ADWEEK House during the marketing conference Possible.
Up until now, PayPal has only sold ads that ran on its own platform. With the move into programmatic, PayPal is now pitching advertisers on targeted ads that appear on other publishers’ websites.
Six-month-old PayPal Ads is the financial firm’s bet on selling digital ads using data about what PayPal shoppers buy across its platforms including PayPal, payment-sharing app Venmo, and cash-back shopping tool Honey. PayPal recently launched its ads business in the U.K.
PayPal is one of several non-retailers that are selling ads using transaction data. Companies like JPMorgan Chase, Uber, and United Airlines also sell so-called commerce media. PayPal’s pitch is that it has a purview into shopping data across thousands of retailers and merchants.
PayPal aggregates data from 30 million merchants and 400 million shoppers. PayPal hopes the move into programmatic will help advertisers reach a wider group of consumers beyond its own properties—giving PayPal more reach and the ability to compete for ad dollars going to huge social networks.
“Programmatic is a big opportunity for us,” Grether told ADWEEK. “My biggest challenge is that I don’t have enough eyeballs on the PayPal apps to compete with large social networks.”
Publicis Media is the first agency to test PayPal’s offsite ads.
Retail media is going offsite
About 80% of retail media spend this year will be spent on onsite advertising this year, according to EMARKETER. The research firm expects total retail media spend to hit $60 billion this year.
While offsite represents a smaller portion of ad spend, commerce media companies want to sell offsite ads to extend their ad revenue. Retailers are also betting that offsite ads will help them grab bigger budgets that brands spend on social media and programmatic advertising.
Independent retail media analyst Andrew Lipsman said that PayPal’s move into programmatic could be particularly big for non-endemic advertisers that don’t sell products through retailers like entertainment and insurance companies. Unlike retailers, PayPal’s data is aggregated across multiple retailers and merchants, potentially giving brands significantly more data to use when targeting digital ads.
