Uber, DoorDash announce ad business expansions

The ridesharing company is trying to make “mobility media” happen.
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· 4 min read

Retail media networks are so 2021.

On Wednesday, Uber announced the formal debut of its advertising network, letting it show ads to riders on the way to their destination. Similarly, DoorDash announced on Monday that it’s expanding its own advertising network to include more self-service options for advertisers.

As advertisers lose signals about consumers, any company with a captive audience—be they an app or retailer—can potentially make a few extra billion dollars by running ads, a sign that walled gardens are growing greener than ever.

Retail media ad spend is expected to jump 31% to nearly $41 billion this year, nearly tripling from 2019, according to Insider Intelligence.

Uber’s network is part of what Mark Grether, Uber’s general manager of advertising, is calling “mobility media.” Still, it remains to be seen whether mobility advertising networks can compete with the likes of more established retailers and their media networks, like Walmart, or the newly minted Kroger-Albertsons which can mine their massive amounts of shopping data to help advertisers reach audiences.

“What will happen in our industry is you will see a consolidation. A few big players will basically command most of the advertising spent. And I would argue the size of Uber allows us to really command an outsize component of the media spend,” Grether told Marketing Brew.

As of Q2, Uber touted 122 million monthly active consumers, while Lyft, which rolled out its media network in August, had almost 20 million “active riders.” DoorDash touts 25+ million monthly active customers.

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Uber has been testing its advertising offering since August of 2021. After a soft launch in June, the company formally announced its offerings worldwide this week.

Uber Eats will primarily feature CPG advertisers and retailers, will be mostly performance-based, and sold on a per-trip basis. Grether said that Uber is pitching its ad business to a broad array of advertisers in sectors like tech, travel, and entertainment. The ads—which will largely be used for brand awareness—will all cost the same, regardless of trip length, he said.

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Advertisers so far include NBCUniversal, Shake Shack, and Heineken, according to Grether.

Grether said that Uber could target users with ads based on their destinations as well. For example, if a user was taking an Uber to Walmart, they could be targeted with an ad for P&G products, he said.

Earlier this year, Uber projected  its ad offering would bring in more than $1 billion in revenue by 2024. DoorDash, which doesn’t break out its advertising revenue, reported that it made $3 billion in “sales generated for merchants through ads and promotions” between  July 2021 and June 2022.

On Monday, DoorDash expanded its self-serve advertising platform for CPGs, providing restaurants, retailers, and the brands sold within those retailers with more options. The company currently isn’t accepting nonendemic advertisers, Toby Espinosa, VP of DoorDash’s ad business, told Marketing Brew.

There are some clear differences between many existing retail media networks and what DoorDash or Uber are doing. Unlike many other retail media networks, DoorDash and Uber are courting retailers that also have their own media networks, like Walgreens, which joined DoorDash’s Advertising Week New York panel on Monday, and has had its own retail media network since 2020.

It’s “difficult to make apples-to-apples comparisons” between retail media networks since factors like placement options and measurement methodologies vary, Frank Kochenash, CEO of Omnicom’s e-comm agency, Transact, told Marketing Brew through spokesperson Joanne Trout.

“I do believe it is possible for niche networks to survive, but it comes down to how valuable the narrower, potentially more qualified audience is versus that obtainable from a bigger network,” he said. “Ultimately, the market will evaluate these trade-offs.”

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