Recently, Vox released an article discussing how Amazon has grown to a top three digital media platform, as well as raising concerns regarding Amazon’s ‘pay to play’ marketplace, which is dominated by ads. Advertising on Amazon is now a vital part of any seller’s business plan in order to be successful and gain visibility on the marketplace.
Amazon’s Ad Business Grew 58% in 2021
Amazon is one of the largest marketplaces available to sellers. As the company continues to grow, so does their ad business. As a seller on Amazon, you have the ability to pay for your product or brand to be sponsored and show higher on the results page. According to the Vox article, successful Amazon sellers have to spend anywhere between 10% and 20% of their sales on Amazon Ads. Because a portion of their sales goes toward paying for these ads, sellers tend to raise their prices to make up for this.
Amazon’s Ad Business in 2022
Amazon saw large growth in their ad business in 2021, which has continued throughout this year. In the first nine months of 2022, Amazon’s ad revenue surpassed the money the company makes from Prime, Prime Video, and its other audio and e-book subscriptions combined. Ad revenue continues to increase as prices for the cost-per-click rate also rise, and their ad revenue comes from both on-site and off-site targeting through services such as Twitch, Thursday Night Football, and Freevee.
The Future of Marketplace Ads and Amazon’s Competitors
Amazon continues to grow and evolve as the eCommerce space becomes more popular. Competitors such as Walmart, Home Depot, Macy’s and more have also introduced their own ad businesses and 3rd Party Marketplaces. As this facet of the eCommerce industry continues to grow, we will see a ripple effect across both sellers and buyers as prices continue to rise and the online buying experience evolves.
With this information, now is the perfect time to utilize eCommerce experts to help grow your business across Amazon and other marketplaces. aiCommerce is a global digital marketing agency with a focus on retail and eCommerce marketplaces. With decades of experience, aiCommerce can help your brand grow across eCommerce channels to gain brand awareness and increase sales, all backed by our 90-day guarantee. In a quickly changing, vast eCommerce world it is crucial to stay agile and adaptive while growing your brand across various channels. If you’re interested in learning more or qualifying for a free Amazon audit from aiCommerce experts, please click the button below!
