PayPal just opened a new ad business. The exec leading it unpacks the plan to link advertisers with its trove of transaction data.

Core Insights - PayPal is launching an advertising business, starting in the US, leveraging its transaction data and large user base to attract advertisers [1][2][4] - The new service, PayPal Ads, will allow brands to run ads across PayPal, Venmo, and Honey, with plans to expand to over 30 million merchants next year [2][3][6] - The advertising market is shifting towards retail media, with significant ad dollars expected to be allocated to this space, providing high margins for sellers [5][6] Company Strategy - PayPal aims to address challenges in the retail media ad space by offering cross-merchant data, allowing marketers to streamline their advertising efforts [4][5] - The company plans to expand its advertising offerings to include video ads and self-service ad software, as well as entering new markets like the UK and Germany [7][8] - PayPal's advertising strategy is part of a broader initiative under CEO Alex Chriss to make the company more agile and competitive in the market [8] Market Context - The retail media space is projected to capture around $1 in every $7 of US ad dollars this year, highlighting its growing importance [5] - PayPal's 429 million active accounts provide a substantial audience, positioning it competitively against major retailers like Amazon and Walmart [6] - The entry into advertising comes as the market becomes increasingly crowded, with existing players like Mastercard and various data vendors already established [8][9]