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Calling a car? On Lyft, it might start feeling more like YouTube.
The ridesharing app has begun showing video ads to riders, Zach Greenberger, the company’s chief business officer, told Marketing Brew.
The ads, which the company announced Thursday, will begin playing automatically (but will be muted) and can run anywhere between 15 seconds and four minutes. Warner Bros., BetMGM, and Universal Pictures have already signed on to advertise, according to a company blog post shared with Marketing Brew.
“Video ads are generally really engaging,” Greenberger said. “It’s some of the most common feedback that we’ve gotten from our customers when we’ve just been generally thinking about the future of our product roadmap.”
The move to branch out into video ad inventory marks an expansion of Lyft’s media business, which includes in-app display ads, ads that appear inside rideshare vehicles on tablets, on rideshare bike stations, and on the roofs of some rideshare vehicles. The business has been bolstered by an acquisition: Lyft purchased the out-of-home startup Halo, which compensates drivers who display digital ads on the roofs of their vehicles, in 2020.
The company is also partnering with measurement firms Nielsen and Kantar to help the company and its clients measure the performance of Lyft’s campaigns, Greenberger said.
Everything is an ad network: Lyft is competing in a crowded field. Though the app isn’t exactly a retail media network in the traditional sense, pretty much anyone with an audience (in this case, passengers) has explored the option of building a media network to earn additional revenue. For retail media in particular, the category is expected to grow to $166 billion by 2025, and will account for about a fifth of all digital media spend this year, according to eMarketer.
Uber began selling in-app ads in 2022, and said it served roughly 550,000 advertisers in Q4 2023, up 75% year over year. During the company’s quarterly earnings call last month, Uber CEO Dara Khosrowshahi told investors it was on track to surpass its $1 billion advertising revenue goal this year.
Greenberger said “hundreds of advertisers” bought Lyft ads last year, although he declined to be more specific or share how much revenue the ad business has brought in.