Amazon already commands almost half of U.S. e-commerce spending — and now it’s coming for America’s ad dollars.
According to a new report from digital marketing research firm eMarketer, the Seattle-based behemoth is poised to become the third largest ad platform in the country this year, commanding 4.1 percent of the digital ad market, a spectacular rise in just a few short years.
Between 2017 and 2018, U.S. advertisers increased their Amazon spend by 144.5 percent to a total of $4.61 billion. Though eMarketer says some of this growth can be attributed to a change in Amazon’s accounting practices, it still means that the e-commerce company will zoom past both Microsoft — which owns LinkedIn — and Verizon subsidiary Oath, which owns AOL and Yahoo, to take third place on the list of digital ad heavyweights, behind only Google and Facebook.
The top two names on the list still wield more power than all the rest combined — together, Google and Facebook are expected to control 57.7 percent of the market, down only slightly from 59.1 percent in 2017 — but Amazon is no doubt seen by both as an insurgent threat, as its sponsored listings look increasingly attractive to advertisers.
Not only do users come to the site to buy, rather than to connect with family and friends or catch up on news, clicks on Amazon’s paid listings, one of its most ubiquitous ad categories, have increased 17 percent since the beginning of 2018, according to a recent survey by digital intelligence company Jumpshot.
And as Amazon increasingly becomes the site shoppers visit to start product searches, Google should be paying close attention. The search giant currently leads the pack with a 37.1 percent share of the digital ad market, which includes significant spending from retailers thanks to its Google Shopping ads. According to another report from this spring, these campaigns command 76.4 percent of retailers’ search ad budgets.
Despite its widely-publicized struggles on the legal and bureaucratic fronts, Facebook is also still a force to be reckoned with, hoovering 20.6 percent of ad spend. Users may not be spending as much time perusing the News Feed, but they are still flocking to Instagram.