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Amazon Rises To Advertising Powerhouse

The global tech and e-retailing giant, Amazon, has soared to the number three spot in the US digital ad market right behind Google and Facebook thanks to its access to copious consumer data and clever advertising practices, it’s set to be the next online advertising powerhouse.

Currently, Amazon manages almost half of all online sales in the US, and although the company accounts for only 4% of the market, they are rapidly expanding its advertising opportunities for marketers and hiring extensively in its advertising unit.

What Amazon can offer marketers more so than Facebook and Google, is customer access and purchasing data leading to insights into shopping habits which can inform successful advertising campaigns that resonate most with customers.

Quoted in The Australian, CEO if Orca Pacific — an ad agency and consulting firm — John Ghiorso states “They have the data because they have the consumer.”

According to a report in the Wall Street Journal, the online retailer’s ad revenue is on track to double this year to US$5.83 billion, and its ad sales are expected to rise to US$28.4 billion over the next five years, which is more than ad revenue increased for all television networks globally combined.

Marketer selling ads, including digital publishers, TV networks, and retailers like Walmart, are already losing business to Amazon as the tech giant utilises all the advantages it has at its disposal to increase potential ad space.

A lot of Amazon’s ad business comes through its retail site, where businesses can pay to be listed as a “sponsored product” high up in the search results when a user enters a related term.

Marketers using Amazon can use video ads, TV-style spots in live sports telecasts, ads on the company’s FireTV device, and more. Amazon can also advertise brands across the web on sites it doesn’t own.

The movie franchise “Minions” and the musical film starring Hugh Jackman “The Greatest Showman” both bought ad space on the cardboard boxes and bags used for Amazon deliveries.

Popular children’s yoghurt brand Petits Filous also paid to add instructions on Amazon Pantry boxes for children to craft them into rockets or pirate ships. According to the WSJ, these instructions were sent to more than 200,000 homes in the U.K.

Amazon is rumoured to be exploring the idea of placing ads in the Echo Show smart speaker with a display screen.

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