Alex Wong/Getty Images; Samantha Lee/Business Insider
Marketers cut ad spending in the pandemic, but e-commerce advertising has boomed as people shop more from home – with Amazon leading the pack.
EMarketer said Amazon claimed 10.3% of the US digital ad market in 2020, up from 7.8% in 2019 – competing with Google and Facebook for ad budgets. That growth has attracted Walmart, Instacart, Walgreens and other retailers that have joined Amazon in vying for a slice of the pie.
Here’s the latest on what we know about Amazon’s moves to grow its advertising business.
How big is advertising for Amazon?
Amazon made about $21.5 billion from advertising in 2020, up from roughly $9.3 billion in the year-ago period.
While that amount is a tiny sliver of Amazon’s revenue from retail sales and Amazon Web Services, its cloud business, advertising is one of its fastest-growing areas. The tech giant continues to cut into advertisers’ search budgets that mostly go to Google.
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The pandemic’s impact on Amazon
While advertisers have slashed TV and some digital budgets during the pandemic, Amazon’s advertising has grown as people do more of their shopping online. Amazon has also increased the advertising potential of Twitch, its live-streaming service whose viewership has grown during the pandemic.
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Ad tech’s role in Amazon’s ad business
Advertisers and sellers often cite a lack of data and tools as challenges in advertising on Amazon, which has given rise to a cottage industry of firms that specialize in helping marketers navigate the site. Meanwhile, Amazon has pushed further into programmatic advertising with its OTT arm that sells ads in some Fire TV apps.
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- Amazon is breeding a new crop of marketing startups, and investors are buying in
- Amazon is ramping up its pitch for audio ads after long promising Alexa would be ad-free
- Amazon’s new OTT pitch deck shows how the e-commerce giant is letting advertisers use Alexa to market their products
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Ad measurement
Amazon has loads of data about how people shop and has offered advertisers more data to help buy and target ads. Still, advertisers say that Amazon’s data can be limited and continue to find new ways to measure ads.
- Read more: Amazon started showing a favored metric for advertisers this month, making it easier for large brands to compare ad efficiency against Google and Facebook
- Amazon is rolling out a tool that shows just how much Google and Facebook ads drive people to do their shopping on the e-commerce site
- Amazon is finally letting brands track traffic from Facebook in its latest effort to cozy up to big marketers
Who runs Amazon’s ad business?
Amazon is notoriously secretive as a workplace. As Amazon’s advertising ambitions have grown, it’s cultivated a team of execs who pitch advertisers on its ad business.
They include several longtime Amazon employees, including Colleen Aubrey, who is part of Amazon’s executive suite. Amazon has also hired big names from ad agencies and brands over the past few years to build teams that work directly with advertisers.
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How to get a job at Amazon
Amazon is consistently looking for advertising talent, but its heavy focus on culture makes it hard for outsiders to break into the company.
We talked to insiders about how to ace the interview process.
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