We propose and numerically investigate a novel compact planar microcavity design based on a high-index dielectric slab waveguide with an embedded monolayer semiconductor. Compared to more traditional vertical Bragg microcavities, our design relies on the transmission of guided optical modes and achieves strong exciton–photon coupling in a chip-compatible and compact geometry with sub-100 nm thickness. We show that Rabi splitting values of more than 70 meV can be obtained in planar microcavities with a total length below 5 μm. Further, we reveal the dependence of Rabi splitting on the dimensions of the structure and explain it with a simple theoretical model. Our results contribute towards the development of novel compact 2D semiconductor-based components for integrated photonic circuits.