Uber Advertising; it’s getting there.
The rideshare company formally organized a new segment of the business called Uber Advertising on Wednesday, a year after hiring former Sizmek CEO and Amazon Advertising director Mark Grether as GM of the new ads business.
Uber also introduced a new ad offering called “journey ads” that allow brands to target Uber riders based on their destination.
A rider’s destination and where they often travel is a powerful targeting tool, and one that doesn’t involve user-level information or targeting capabilities, Grether told AdExchanger.
“We’re not doing any individual user-based targeting,” he said. “I think contextual is a better way of thinking about it.”
For instance, he said a brand might target riders who are going to or traveling around the Hamptons. A retailer or fashion brand might target anyone who’s traveling to Fifth Avenue, a famous shopping strip in New York City. Specific stores, malls, cinemas, etc., would all be targetable.
Advertising businesses like Uber Advertising, which are adjacent to non-ad-based companies, must plot a perilous course between really strong and even easy revenue opportunities and potential privacy issues or user blowback.
For instance, a few months ago Lyft Media launched a similar destination-based ad product, but with a narrow group of pre-set destinations that can be targeted, starting with travelers to and from airports. But Lyft wouldn’t let, say, Lowe’s target users who get a ride to or from a Lowe’s store.
Uber is taking a bigger bite of that destination revenue by allowing brands to decide for themselves which destinations they want to target and hone in on specific locations.
Uber Advertising is still early days, with only a managed service product at the moment. But after hiring about 100 salespeople who are doing the direct sales, the company formalized the ad unit as its own business segment.
The managed service approach could serve as a control, since it means is that an advertiser wouldn’t be able set targeting parameters without it passing muster with Uber itself. If an advertiser brand wants to target, say, people coming to and from hospitals, they couldn’t without Uber being aware of it.
Grether said Uber Advertising will launch a self-service platform, potentially in 2023, but for now the journey-based targeting does go through Uber.
The Uber KPIs and buying model could also change with self-service. Advertisers don’t buy Uber on a CPM; the company sells on a “cost per trip.” One advertiser “owns” the in-app branding for that ride, regardless of the duration of the trip or programmatic factors like viewability. Grether said there is also a more straightforward performance model for mobile apps, which could deeplink from Uber to a download.
Retail media has established itself in the minds of advertisers as a way to target audiences through first-party data platforms set up by non-ad companies, Grether said. “But I do think the next big wave is going to be mobility media.”
