Lyft announced the launch of Lyft Media, a new digital advertising business unit with the potential to add billions to its bottom line.
The company announced on his blog Monday that Lyft Media will help capitalize on the rapidly growing in-car digital ad market as cars become more connected, often with multiple, larger infotainment screens. The newly created business unit will also maximize Lyft’s revenue through its mobile app, rooftops and bikes.
The news comes just days after Lyft and its biggest competitor, Uber, both reported impressive second-quarter financial results.
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Lyft knows that advertising activity can be a solid way to increase results. Uber, which entered the media business in 2019, first through UberEats and later through its rooftops and ride-sharing app, says its advertising business could hit $1 billion in revenue by 2024.
Lyft’s blog post outlines a four-pronged plan to grow ad revenue and compete with rivals.
“Our vision is to build the largest transportation media network in the world, delivering value to advertisers while enhancing the platform experience for passengers and drivers,” the post read.
According Techcrunch Lyft made its first digital ad with the 2020 acquisition of Halo Cars, which makes the roof screens that play digital ads. The company is already using Halo displays to display location and time-targeted ads on some of its rideshares in New York, Los Angeles and Washington DC with plans to expand to other cities.
Lyft also displays ads on in-vehicle tablets that allow passengers to track their route, rate and tip drivers, and control music through Lyft’s partnership with iHeartRadio. Lyft said it plans to roll out the service to 25% of its trips in Los Angeles, Chicago, San Francisco and Washington DC to reach millions of riders by the end of the year.
Finally, the company also sees its mobile app as a channel that can help brands reach nearly 20 million active users, as well as its bike-sharing billboards and docks, as well as directly on its e-bikes from new generation.
Lyft said a portion of the revenue generated from in-car ads would be shared with its drivers, but did not specify how much or what percentage drivers would get.
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