The news: McDonald's launched an ad business that it says could scale to $1 billion in revenues.

The McDonald’s Media Network will display ads in-store after customers order on kiosk screens and in the McDonald’s app, it said at an investor conference.

A pilot is already underway at select stores.

How we got here: McDonald’s sales growth was the weakest in more than a year in Q2 2026, when visits fell 4.5% YoY as lower-budget consumers got squeezed by higher gas and food prices.

With sales lagging, McDonald’s is turning to advertising as a new source of revenues.

Will it work? On paper, McDonald’s could develop a robust ad business. McDonald’s says it has 14,000 retail locations and 70 million daily global customers—including 90% of the US population, per McDonald’s—giving the fast food chain a loyal and engaged customer base.

But its $1 billion target may be too ambitious.

We forecast US retail media ad spending will total $74.40 billion this year, accounting for 15% of total media ad spend. But in-store retail media advertising makes up a tiny portion of that—and won’t reach $1 billion until 2029.

The in-store retail media opportunity remains largely untapped. Eighty percent of retail sales take place in-store per Deloitte, meaning there is significant opportunity to advertise to in-store buyers. But a lack of infrastructure and reporting data for in-store placements, even on digital kiosks and menu boards, makes it hard for advertisers to buy inventory and measure an ad’s impact.

McDonald’s best bet for immediate gains may be its app, which collects spending and other consumer data that can be sold to marketers while serving ads to users.

Implications for marketers: More players in the market mean faster development of in-store retail media advertising tech and strategies—and also opens the possibility of lucrative partnerships for ad tech firms and vendors.

While marketers wait for more standardized in-store ad options and reporting, they should experiment with unobtrusive ads placed at the end of the ordering process and on menu screens to reach loyal McDonald’s customers at the point of purchase.