The Amazon Ad Empire Continues To Grow

0
1219

By, Peter Koeppel

The digital marketing duopoly of Google and Facebook have long reigned over a huge chunk of the industry’s ad spaces.

With Google holding about 37 percent of market share and Facebook controlling over 20 percent, the two alone have more than enough power and influence to shove the competition out of the way.

Or do they? While Amazon is currently only controlling around four percent of the market, it’s becoming a far more palatable platform for brands that have been burned by experimentation with digital advertising in other spaces.

Amazon’s Strength as an Ad Platform is its Specificity

A four percent share of any segment isn’t an impressive number, there’s no one who would argue that point. However, the fact that Amazon came out of practically nowhere and has already reached that point with its digital advertising share is pretty interesting.

Brands seem to agree, since they’re throwing their money at Amazon’s ad platform as fast as they can, with some marketers moving 50 to 60 percent of their ad spend from Google search ads to Amazon’s platform.

Any random product search on Amazon will immediately demonstrate why this is becoming a trend. Many of Amazon’s ads are positioned as products, others are housed in attractive banners at the top of search results. They’re classy, smart and attractive. What’s not to like? 

There are a few reasons why Amazon’s position may quickly become a much bigger deal, and these seem to be the most impactful:
  • Product ads look just like product listings. Rather than standing out, many paid product ads on Amazon’s platform are merely bumped to the top or disbursed within search results.They can look just like product listings so that shoppers never really realize they’ve seen an advertisement at all. All they know is that they bought a new shower curtain and it’s the best thing ever.

 

  • Measuring ROI is super easy. Google ads and social media are important and have their places, but when it comes to figuring out just how much it cost to acquire those customers, advertisers and brands are sometimes left shrugging their shoulders.When a brand is advertising its brand new product on Amazon, it’s easy to connect clicks to the purchase, especially if that brand is selling its product through the Amazon website.

 

  • There’s basically a zero chance of a brand’s ad being run beside hate speech or pornography. A lot of companies are still really skittish because of the debacle with YouTube, but they were also fearful of moving from that known space that was producing leads and sales (white supremacists drink Coke, after all).Ultimately, many brands shifted away from YouTube and it’s Google family because they were losing too much control over their own narratives. The message the brand’s platforms send is just as important as what message the brand is sending.

Is Amazon Going to Unseat the Digital Ad Monarchy?

Everything about Amazon advertisements seems to be going wild.

For example, during the third quarter of 2018, business grew 123 percent, to $2.5 billion in revenue. The retail giant’s ad business is predicted to nearly double again through the end of the year 2020 when it’s forecasted to hold about seven percent of market share.

It hardly seems like enough growth to unseat Google from its #1 position, but there’s still something about Amazon selling ads that feel like change is in the air. Unseating Google shouldn’t be the goal of Amazon (and probably isn’t, more likely wishful thinking on everyone else’s part), instead it can win big without so much as moving a finger.

Leveraging Amazon’s Existing Positioning

Amazon sells stuff… and lots of it.

Basically, anything a human has ever imagined can be located on Amazon, from candles that smell like old books to trash cans that look like R2D2. This is Amazon’s strength for a particular segment of the ad market. It sells stuff. So, understandably, if a marketer also has stuff to sell, they’ll turn to Amazon ads to raise visibility among a population that is ready to buy just as soon as they see the right product.

If that same marketer provided lawn services or dentistry, it would make a lot less sense to advertise using Amazon. Instead, that client is better served on social media or through Google. Basically, what Amazon is doing is creating a new way to reach customers. And that’s ok.

As the Internet continues to mature, there will be more companies realizing Amazon has a captive audience. Amazon is just now feeling confident enough to really push into selling ads, but it’s good that it is. What it’s offering is quickly becoming a much-needed middle ground between social and search.

About the Author

Peter Koeppel is Founder and President of Koeppel Direct, an influential direct response media firm focused on direct response television (DRTV), online, print and radio media buying, marketing and campaign management. With a Wharton MBA and three decades’ experience in marketing and advertising, Peter is a widely recognized leader who has helped hundreds of Fortune 500 companies, small businesses and entrepreneurs from all industries develop and implement successful direct marketing campaigns. Peter, who shares regularly on his popular blog, is a sought-out expert on all things media, and has been interviewed and covered in Forbes (Forbes Agency Council), Entrepreneur, Investdigital or’s Business Daily, Electronic Retailer (Editorial Advisory Committee member), Response (member Advisory Board), MacNewsWorld, TechNewsWorld, eCommerce Times, Microsoft Small Business and Wharton Business Radio.

LEAVE A REPLY

Please enter your comment!
Please enter your name here