Amazon is now the 5th largest generator of digital ad revenue in the U.S.
While it may not be the first company you think of when considering a digital advertising campaign, Amazon should definitely be on your list. The e-Commerce platform and content giant is now the 5th largest generator of digital ad revenues in the U.S., and is expected to earn $1.65 billion by the end of 2017.
Major Ad Growth
“Ad revenue continues to grow very quickly,” Dave Fildes, director of investor relations said on the company’s earnings call. “We’re generally pleased with the ad business. Our goal is to be helpful to consumers and help them make better shopping decisions… while also giving them targeted recommendations, making it helpful for customers instead of intrusive.”
What’s their top advertising product? Sponsored Products Ads are the most heavily targeted, and account for a whopping 82% of all Amazon ad spending. Headline Search Ads and Product Display Ads are also growing rapidly quarter over quarter.
Banking on Non-Endemic Brands
Amazon has also heavily invested in programmatic growth in its self-serve offering, and trying to get more brands to buy ads on its platform that don’t sell on the e-Commerce site. These non-endemic brands include courting advertisers for auto brands, wireless and telecom companies.
The “Total Wallet” Perspective
Why is Amazon slaying it with advertising? Their pitch is that their platform can offer advertisers a “total wallet” perspective. In other words, connecting what people are searching for with what they’re buying online. The massive online shopper base that Amazon has provides a wealth of first-party data. And, this data will continue to grow with the company’s acquisition of Whole Foods earlier this year.
While new and growing (we’ve seen some pushback on analytics and UE) Amazon’s ad platform should be a frontrunning marketing contender for most e-Commerce sellers.