How Amazon Doubled Their Advertising Revenue in 1 Year

admin_fortress | May 03, 2019

Published in Marketplace News

Amazon, the Rising Star of Digital Ad Revenue

You might be noticing more ad placements across Amazon search pages and product listings. And if you’re a brand owner, you’re probably considering how to allocate your digital budget across platforms — continue allocations to the “duopoly” — Google and Facebook or increase spend into Amazon, the big behemoth new kid on the block for digital ad spend.

The Situation Defined

According to E-marketer’s forecast, Amazon will experience the largest growth of digital ad spend share, gaining an additional 2.2% in market share by the end of 2019. In 2018, Amazon’s ad revenue is estimated to be $10B, a 100% growth from the prior year and is expected to increase another 50% this year.

For the first time ever, Google’s market share will decrease year over year although total ad spend dollars are increasing. Only Amazon and Facebook are expected to take on more marketing share in 2019 of the top five companies dominating digital advertising.

Brands with deep pockets certainly contribute to the shift in ad dollars and recognize the value of investing in Amazon advertising.

Why Amazon Advertising?

With +100M Prime members, a direct point of purchase, and thorough audience data on historic purchases and searches, Amazon is a win-win when it comes to advertising ROI realized. Amazon’s marketplace collected audience data long before their ad business came along. We now know that 50% of product searches start on Amazon and landing on Page 1 of an Amazon search can get your product to make up 80% of purchases. As a brand, strategic ad placement on Amazon makes a lot of sense.

Marketing ROI has historically been difficult to actualize. With the rise of digital advertising, while some returns are still unclear, we can now compare conversion rates across platforms. And Amazon seems to be a clear winner here.

We’ll continue to track Amazon’s ad revenue growth and report back whether the 50% growth is realized. In the meantime, we highly recommend jumping on the Amazon wagon. Contact us at Fortress Brand if you want some help from the experts.

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