How PayPal is trying to grow its ads business with an offsite offering

PayPal is seeking to grow its ads business by making better use of the reams of data it has from users and retailers. Today, the payment company announced the launch of Offsite Ads, an expansion of PayPal Ads that will bundle programmatic inventory with insights generated from user transaction data across its properties, which include PayPal, Venmo and Honey. Advertisers can purchase display and video ads on any standard programmatic ad format PayPal has curated with supply-side platforms, said Mark Grether, senior VP and general manager at PayPal. That inventory will be packaged with tailored targeting insights generated from the transaction data of more than 400 million global PayPal users and 30 million merchants. For example, one insight could lead to PayPal creating a custom audience based on the advertiser’s target consumer, which they could then target with relevant inventory across mobile web, apps, desktop and connected TV. “We want to be where purchase intent actually happens,” Grether said. “Hence, we need to go outside of just PayPal and Venmo. We also need to make sure we have the reach and frequency that our advertisers demand to be a meaningful partner on a media plan.” The offering is first launching in the U.S., but will “fast-follow” in the U.K., where PayPal will need to ensure Offsite Ads are compliant with General Data Protection Regulations that limit how organizations can use personal data, Grether said. (PayPal’s privacy policy states that users must “opt-out of Personal Information sharing with Partners and Merchants for personalized shopping experiences.”) PayPal Ads, which formally launched in the U.S. in October, at the time only included display ad sales on PayPal properties. It launched on-site ads in the U.K. early this month and plans to bring on-site video ads to the U.S. soon, Grether said. Offsite ads have long been a part of Grether’s plans for PayPal Ads. PayPal hired Grether, best known for building Uber and Amazon’s ad businesses, in May 2024. Publicis Media will be the first agency partner to offer Offsite Ads to brands. Buyers will pay a “competitive” price for every 1,000 impressions an ad receives, Grether said, without providing exact figures. Offsite Ads combine transaction data from multiple merchants, giving brands a broader view of the commerce landscape than any single retailer can provide, Grether said. He added that the new offering will simplify measurement, solving a pain point media buyers commonly face as they have tried to track performance across retailers providing different data sets. “If you think about how many retail media companies are getting born, I think we’ve stopped counting at 200,” Grether said. “The agencies and advertisers can’t manage 200 retail media networks one by one.” Media execs have previously told Ad Age that despite efforts from platforms like The Trade Desk to pair media inventory with retailer conversion data, measurement is difficult as inventory and sales data come from separate places. Read more: Why Liquid Death’s chief media officer pays special attention to the upper funnel Grether stated that cross-retailer measurement will also enable advertisers to look past incremental growth in single ecosystems and start tracking market share across networks. “Market share is typically the real trigger for CFOs to give CMOs more money,” Grether said. PayPal Ads’ performance Brands including Expedia, McDonald’s, Verizon and Best Buy have purchased PayPal’s on-site ads since they launched in October. “It’s really great to see how we’re getting momentum, but more importantly, how the momentum is accelerating,” Grether said. “We’re talking to advertisers and agencies—you don’t want to know what my schedule at Possible is going to look like." PayPal declined to provide specific growth and revenue figures for its ad business. PayPal recently confirmed that an RFP process is ongoing as it searches for a new global media agency after WPP resigned the account. Other financial service companies have also built up their ad businesses. JPMorgan Chase in April 2024 announced Chase Media Solutions, which places display ads informed by consumer transaction data on its digital properties. American Express in August updated its ad offering to let advertisers target new customers with offers five days after they get their credit card. They previously had to wait 30 days. The moves come as retail media explodes. Commerce media ad spending in the U.S. is expected to surpass $100 billion by 2028, according to a February report from eMarketer. Data-driven Marketing Playbook: Join industry leaders on May 22 to explore how data can drive marketing strategies, optimize media buying and improve customer engagement. Learn more here.

How PayPal is trying to grow its ads business with an offsite offering

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