PayPal Holdings Inc. PYPL is set to launch an advertising business, leveraging the data of its millions of users. The company has hired Mark Grether, former head of Uber’s advertising unit, to lead this new division.
What Happened: PayPal aims to capitalize on its vast user data to create an ad sales business. The company will utilize the data it collects from tracking user purchases and broader spending behaviors to develop an ad network, reported The Wall Street Journal.
Grether, who previously led Uber’s advertising business, will serve as the Senior Vice President and General Manager of the newly-formed PayPal Ads division. He will be responsible for creating new ad formats, managing sales, and expanding the division’s team.
PayPal introduced its first ad product, Advanced Offers, in January. This product uses AI and PayPal’s data to help merchants target PayPal users with personalized promotions. The company plans to extend its ad sales to non-endemic advertisers, who do not sell products or services through PayPal.
PayPal processed 6.5 billion payments from approximately 400 million customers in the first quarter of 2024. The company aims to leverage this data to provide advertisers with a detailed picture of the consumers they are targeting.
Why It Matters: This move by PayPal comes at a time when the company is attracting significant investor attention. Despite a dip in its fortunes from pandemic highs, PayPal’s profits rose in the first quarter of 2024, leading to an improved outlook for the year.
PayPal’s first-quarter profit increased, and the company also raised its outlook for the year.
"If you're someone who's buying products on the web, we know who is buying the products where, and we can leverage the data," Grether said.
He added that consumers using the PayPal credit card would also share real-world bricks-and-mortar store data with the company.
Price Action: PayPal’s latest trading price is $61.64, with pre-market trading at $62.70, representing a 1.72% increase on Tuesday, according to the data from Benzinga Pro.
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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote
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