From Adweek · Lauren Johnson · · 1m 20s
McDonald's builds $1 billion ad business
The fast food giant is launching an ad network to sell targeted ads to brands across its 14,000 stores.
In brief
The fast food giant is launching an ad network to sell targeted ads to brands across its 14,000 stores. McDonald's is entering the lucrative commerce media market by selling ad space in its app, kiosks, and restaurants to reach its 70 million daily customers. Originally reported by Adweek.
McDonald's launches ad network
McDonald's Media Network will sell targeted ads to brands across its app, kiosks, menu boards, and restaurants. The company aims to generate $1 billion in annual ad revenue.
“It's an opportunity to generate revenue for the system with little in the way of additional cost, no operational complexity, and no disruption to our customer experience.”
Testing began in August
McDonald's started testing the ad network in 450 company-owned U.S. stores in August. The company plans to expand to franchised locations as well.
70 million daily customers
McDonald's reaches 70 million customers daily worldwide, giving it the ability to target specific consumer groups at different times of day with personalized offers.
Entering crowded ad market
Commerce media spending will hit $84 billion in the U.S. this year, but Amazon and Walmart will capture 89% of incremental spending. McDonald's joins non-retail players like Uber and JPMorgan Chase.
One billion is credible
Analyst Andrew Lipsman says McDonald's $1 billion target is achievable because of its 14,000-store footprint and heavy foot traffic. Target's ad arm made $915 million last year.
“McDonald's is one that I think will work out.”
The big picture
McDonald's is entering the lucrative commerce media market by selling ad space in its app, kiosks, and restaurants to reach its 70 million daily customers.
