PayPal launches an advertising platform based on comprehensive customer transaction data.
The company has appointed Mark Grether, former vice president and general manager of Uber's advertising business, as vice president and general manager of the new advertising unit to lead the advertising business.
Grether is responsible for developing new advertising formats, overseeing sales, and hiring employees to fill vacant positions in the department.
The digital payments company's new advertising business includes information buying and spending habits of customers of PayPal and sister app Venmo, the Wall Street Journal reported.
“When you buy a product online, we know who is buying the product where, and we can use that data,” Glaser said in a statement to the Wall Street Journal. PayPal receives purchase data from customers who use their credit cards in stores. "
PayPal intends to collect customer data by default while offering an opt-out option. However, PayPal has not yet clarified what kind of data it wants to collect because the advertising platform is still in its early stages.
In addition to ads, the company also plans to offer transparent, easy-to-use privacy controls.
PayPal announced in its latest earnings report that the company processed up to 6.5 million transactions from 427 million customers in the first quarter of 2024.
The company said the new platform can help merchants sell additional products and services while displaying related products to customers.
Earlier this year, PayPal launched its first advertising product: Advanced Offers.
The platform uses artificial intelligence and business data to analyze customer purchases and help merchants target PayPal users with discounts and other promotions.
Premium plans only charge advertisers when consumers make purchases. Online marketplaces like eBay and Zazzle have begun testing it.
The company now aims to sell advertising to both its clients and advertisers who do not sell products or services through PayPal.
These companies may use PayPal data to show consumers ads that may appear elsewhere, such as on other websites or on connected TVs.
In addition to data-driven advertising, the company has also begun offering non-targeted commerce offers through Venmo.
By bombarding it with promotions, the company hopes to avoid alienating younger users who view Venmo as a social network.
It's worth noting that PayPal isn't the only company selling ads based on transaction information.
In January, a Consumer Reports study found that Facebook receives information about its users from thousands of different companies, including retailers like Walmart and Amazon.
JPMorgan Chase also said it is building an ad network based on customer spending and will allow advertisers to target users of its website and banking apps based on transaction history, while Visa is making a similar decision.