Amazon’s expected growth in digital advertising is a sign of the e-commerce company’s power to reach consumers when they’re almost ready to shop. Amazon’s share of the U.S. digital advertising market last year surpassed 10% for the first time as marketers sought to reach homebound consumers as they shopped online during the pandemic.
The 53% growth in the e-commerce giant’s ad business to $15.73 billion pushed its market share from 7.8% in 2019 to 10.3% last year. The pandemic led to a surge in online shopping that has made these ad networks more significant for marketers. E-commerce channel advertising, which includes search and display ads on its retail properties, makes up about 89% of Amazon’s ad business. The remainder comes from ads on its video platforms and ads sold through its demand-side platform for ad placements outside of its digital properties. This year, Amazon’s share of the nearly $24 billion e-commerce channel ad market will reach 76%, far exceeding second-place Walmart with 6.5% of the market. As Amazon tries to enter the digital market, Google and Facebook also try to make a mark in the digital mark. Google not only had evolved Google Shopping to drive traffic to retailers, but it also has undertaken programs like its recent partnership with grocery chain Albertson to offer information to shoppers. Facebook has added more shopping features to its social network, and apps including Instagram, Messenger and WhatsApp. But, Amazon’s strength in e-commerce gives its a major advantage.
