As the top US digital advertising company after Google and Facebook, Amazon is finally gaining attention as a formidable player in the space. Its remarkable ascendance has other retailers following its lead, adding fuel to the growing retail media market.
How big is Amazon’s US digital advertising business, and how fast is it growing?
Amazon’s US digital ad revenues will reach $24.47 billion in 2021, rising 55.5% over the prior year and representing 11.6% of the digital advertising market. We expect it to account for 14.6% of the market in 2023 as it narrows the gap with Google and Facebook.
What is Amazon’s role in the retail media advertising trend?
It is the dominant player in retail media and will account for 77.7% of the market in 2021. The ecommerce giant’s realization of this high-margin incremental revenue stream has driven other retailers to follow suit. Differentiated offerings from Walmart, Instacart, and others will keep Amazon on its toes.
How will brands invest in Amazon advertising over the next year?
Amazon’s base of advertisers will expand beyond its core of small and medium-sized businesses (SMBs) on its marketplace. Large multinational brands will invest more in sponsored search and brand-building ads, while advertiser categories nonendemic to Amazon, such as financial services, will focus on offerings through Amazon DSP and streaming TV ads.
How will Amazon continue to attract advertiser spending?
Amazon will attract more brand investment through product innovation, improved metrics for brand and sales performance, and expansion into other ad formats. It will also need to build out its brick-and-mortar footprint—particularly in the grocery and department store segments—to maintain its leadership in first-party data.
WHAT’S IN THIS REPORT? This report includes our latest forecast for US digital ad revenues at Amazon and our analysis of its advertising platform.
KEY STAT: Amazon’s growth in US digital ad revenues will accelerate for the second consecutive year, hitting 55.5% this year on the heels of a 52.5% increase in 2020.
Exportable files for easy reading, analysis and sharing.
Reliable data in simple displays for presentations and quick decision making.
Insights from industry and company leaders.