Digital advertising has produced a massive revenue for players in the field and the race to become the most significant international ad seller has gone tough. Amazon is just one of those who made a big step up in the game.
Although there may be other more in the market, Amazon worked its way up the ladders and is now set to double its U.S. revenue this year. And according to the research firm eMarketer, they estimated that the company would bring in approximately $4.61 billion from digital advertising, one of the bases for the prediction of Amazon’s ad growth, which qualifies the company as a front-line challenger against the duopoly, Facebook and Google.
Why the sudden change in projection? This prediction is due to the estimated increase between 10 to 12 per cent of Amazon’s ad revenue growth. And as eMarketer notes, that will be up to 60 per cent from the company’s March revenue, which indicates Amazon surpassing Verizon’s Oath and Microsoft to become the third largest digital ad seller in the U.S.
Thanks to an accounting change made last Jan. 1, 2018, the company’s advertising services are now a “revenue rather than the cost of sales” (Spangler, 2018) which created a positive outlook to the company’s organic growth. eMarketer’s forecast model expects an annual increase with Amazon’s ad revenue by 2020 and will gain 7.0 per cent share of U.S. digital ad spending from 4.1 per cent, which, however, is still a long way behind compared to Facebook and Google.
Although there may be other more in the market, Amazon worked its way up the ladders and is now set to double its U.S. revenue this year. And according to the research firm eMarketer, they estimated that the company would bring in approximately $4.61 billion from digital advertising, one of the bases for the prediction of Amazon’s ad growth, which qualifies the company as a front-line challenger against the duopoly, Facebook and Google.
Why the sudden change in projection? This prediction is due to the estimated increase between 10 to 12 per cent of Amazon’s ad revenue growth. And as eMarketer notes, that will be up to 60 per cent from the company’s March revenue, which indicates Amazon surpassing Verizon’s Oath and Microsoft to become the third largest digital ad seller in the U.S.
Thanks to an accounting change made last Jan. 1, 2018, the company’s advertising services are now a “revenue rather than the cost of sales” (Spangler, 2018) which created a positive outlook to the company’s organic growth. eMarketer’s forecast model expects an annual increase with Amazon’s ad revenue by 2020 and will gain 7.0 per cent share of U.S. digital ad spending from 4.1 per cent, which, however, is still a long way behind compared to Facebook and Google.
But despite Amazon falling behind the e-commerce giants, the duopoly, the company is making its best effort in regards to advertising. They are still relatively small in the business, but that doesn’t stop them from taking the opportunity to improve their usability tools for advertisers, giving way to smarter recommendations for customers, starting off with introducing more options of video advertising formats to both owned and operated properties which they came up with earlier this month.
The Google and Facebook duopoly is said to maintain its hold in the next few years, but Amazon is still in the fresh business of innovating advertisement tools and systems, so who knows what they may come up with next? I guess it’s safe to say that Amazon is indeed a go-getter.
The Google and Facebook duopoly is said to maintain its hold in the next few years, but Amazon is still in the fresh business of innovating advertisement tools and systems, so who knows what they may come up with next? I guess it’s safe to say that Amazon is indeed a go-getter.
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