Amazon’s ad business is worth almost $3 billion. The company reported in third-quarter earnings today that “other” revenue, which is primarily made up of ad sales, is now worth $2.5 billion, an increase of 123 percent from the year prior.
In the second quarter, Amazon had said that ad revenue was up 129 percent to almost $2.2 billion.
In the past few months, Amazon took a major step in consolidating and simplifying its ad products, merging everything into one platform called Amazon advertising so advertisers can buy everything in the same place.
Marketers now see Amazon as a part of the triopoly, although the company’s overall advertising prowess lags far behind the other two legs of the triopoly, Google and Facebook. Google parent Alphabet, which reported that CPC on Google properties is down 28 percent, had total revenue at $34 billion for the quarter, with the majority of that being advertising. Facebook reports third-quarter earnings next week.
Amazon’s ad business, which some estimates project will reach $50 billion in the next decade, is still a small part of Amazon’s overall business, which was $56.6 billion this quarter. Perhaps because of that, both buyers and brands still have gripes about how slowly the platform is improving. They report that the company still has a way to go with the basics, with somewhat rudimentary toolsets, campaign data and some inconsistencies with how ads are bought and what data you get back.
According to data by Teikametrics, which helps brands advertise on Amazon, 32 percent of revenue for brands that sell on Amazon is now driven by advertising on Amazon. And brands have increasing ad spend overall on Amazon by 250 percent since the third quarter of 2017.
More in Marketing
Fragmentation comes to search advertising as marketers grapple with shifting search behavior
Search ads are changing. Here’s how marketers are preparing for a new search landscape.
Google’s latest Chrome update leaves third-party cookie phase-out as unclear as ever
There are still no clear answers in Google’s protracted third-party cookie phase-out.
The TikTok ban is reshaping creator recruitment and agency best practices on social media
While TikTok’s status in the U.S. still hangs in the balance, agencies are already shifting the way they recruit influencers and develop best practices for their creator campaigns moving forward.