He advertising business of Amazon stands out from its other technological rivals Google and Goal and it has been the one that has grown the most during the last three years. In 2022, this segment reached a annual rate of almost 40,000 million dollars, ten times more than five years ago. In fact, in the economic balance for the last stretch of 2022, the chapter on these advertising services stands out in particular. The results published by Amazon show that throughout the fourth quarter it generated almost 11.6 billion dollars, 19% more than the 9.7 billion dollars recorded a year earlier. The data also improves considerably on that of previous months.
Although the amazon advertising unit It still constitutes a small fraction of the $149.2 billion in revenue that the company founded by Jeff Bezos registered in the fourth quarter of last year, it represents a fast growing area that analysts believe could be a “crucial player” in the digital advertising market. And it is that, what began as a basic functionality to promote products in search results has become an increasingly profitable business, both inside and outside Amazon. Amazon advertising now includes dozens of ad types, technologies, data, and solutions for brands to reach consumers.
On the contrary, the balance has been very different in alphabet, google matrixwhich reported lower-than-expected quarterly revenue initially due to ‘prick’ of digital advertising. The box of Google in that chapter, which includes both Search and YouTube, they fell from 61,240 million in the previous quarter to 59,042 million. The situation has not been ideal either Goalwhich recently reported a 41% drop in its profits for 2022, a year that closed with a balance of 23.2 billion dollars, due to the increase in expenses, competition and the weakness of its advertising market.
Bet on Retail Media
In the next years, Amazon will also continue its strong commitment to the retail media and will visibly continue to dominate the US scene. Since the e-commerce giant launched its advertising platform, the retail sector has been developing different solutions. However, for now, Amazon will continue to monopolize most of the investments in Retail Media in the next four years in the US country.
Specifically, if we look back, according to the study ‘Retail media ad spend in the US 2019-2026, by platform’ made by Statista, Amazon’s total advertising revenue in the US in 2019 was $10 billion. Since then, revenue has tripled and Amazon has risen to become the elite of Retail Media. The company represents almost 80% of total spend in Retail Media. Its revenues are expected to nearly double by 2026 and rise to $64 billion.