Amazon has been quietly experimenting with various ad products across its portfolio and off its website, according to interviews with half a dozen ad buyers and technology partners. The company is also looking to sell advertising beyond Amazon sites and products. Digital advertising was a $209 billion business globally in 2017, according to media buying research firm Magna Global. And it’s only increasing. According to eMarketer Amazon was the fifth-largest digital advertiser in the U.S. in terms of revenue this year. Still, it only makes up a little more than 2 percent of the market. It’s still leagues below industry leaders Google and Facebook, which take up more than 70 percent combined, according to a recent estimate from analysts at Pivotal. However Amazon is hoping to shift budgets to its site next year and make it a top ecommerce site.
“Driving conversion and sales or creating very immersive high-impact branded content is what drives a lot of digital advertising revenue,” said Aaron Shapiro, CEO of advertising agency Huge. “Amazon is a player in both those areas.”
Amazon plans on boosting its ad business by offering advertisers better data and algorithms to ensure its products get in front of the ideal customer. It’s also selling custom pages with built-in video and stories to help advertisers’ products stand out from the rest.
“Amazon likes to talk about how 56 percent of product searches are coming through Amazon,” said Diana Gordon, senior partner at media agency Mindshare. “It’s definitely a stat that causes advertisers to stand up.”
If you remove the buy box on Amazon’s site, it would rank in the top five of daily trafficked sites online, Gordon explained. Aside from driving sales, Amazon is becoming a place where consumers can read reviews on products and services that they want.
The company is also looking to mobile ad technology partners to find ways to advertise across multiple devices.