Amazon announced its fourth-quarter earnings, and reported 60 percent growth year-over-year in its Ad Business revenue category. From the looks of these numbers, Amazon’s Ad business isn’t showing any signs of slowing down.
Advertising was a key contributor to Amazon’s strong growth overall in 2017, and will only to continue to be more profitable as they make moves to expand their advertising offerings. Focused on finding ways to work with vendors and sellers, Amazon is disrupting the traditional ad space by offering a great experience and ability to reach customers.
The company hinted on their earnings call that more is to come in terms of building out their platform. Chief Financial Officer Brand Olsavsky said that Amazon is a “key lean-in from brands and agencies into the e-Commerce marketing space,” which has undoubtedly bolstered their growth.
Comparing to the Competition
Google parent company Alphabet reported an overall revenue increase of 24 percent year-over-year, with its advertising business posting $27.3 billion in revenue in the fourth quarter. Facebook advertising grew 48 percent year-over-year, posting total revenue at $13 billion.
Giving Google & Facebook a Run for their Money
Thanks to the growth of Amazon’s search marketing offering, Amazon Marketing Services, Amazon has begun to give the advertising duopoly a run for their money. Ad spend on sponsored product ads and headline search ads have increased 64 percent and 75 percent quarter-over-quarter.
It was just two years ago when Amazon had to explain why they had an advertising business. As they go beyond the traditional confines of what an advertising business once was, the conversation about how advertising on Amazon works seems to be a bit more urgent with e-Commerce marketers.
Amazon’s Ad Business Goal
Amazon states that they want customers to be able to have an easier time discovering new brands and products that they’re looking for. By driving brand awareness, discovery and better purchase decisions by the customers, Amazon is working with advertisers to help them reach their customer base.
Interested in exploring your company’s Amazon product content strategy? Have a chat with Sellpoints, our Amazon e-Commerce marketing company.