15 Jan

Here’s Amazon’s Latest Foray into Advertising

WRITTEN BY Sean Allen FEATURED IN Company News, Insights, & Analysis and Consumer Discretionary

A program that lets brands pay to send samples

Amazon (AMZN) is beginning to strike gold in its digital ad business. The segment has seen triple-digit YoY (year-over-year) growth in the last few quarters. The company is slowly eroding the Google-Facebook duopoly.

Recently, Axios reported that the e-commerce giant had quietly started a program that allowed some brands to pay to send free samples to Amazon users based on their purchase history.

Here’s Amazon’s Latest Foray into Advertising

As the report points out, offering samples of actual products appears to be more effective than displaying ads on Amazon or other platforms.

Amazon’s digital ad revenue is set to soar in 2019

Brands may not mind paying Amazon to send free samples because Amazon has a trove of valuable consumer data that can be used to target customers. Such data-based targeted sampling could benefit the brands in the long term.

However, it’s not clear whether Amazon plans to conduct this program on a large scale.

According to research company eMarketer’s estimates, Amazon will generate as much as $7.23 billion in digital ad dollars in the United States, behind only Alphabet’s (GOOGL) Google and Facebook (FB), which are forecast to generate $47.89 billion and $27.57 billion, respectively, in 2019.

While Amazon remains far behind those Internet giants, the e-commerce juggernaut is attracting a lot of marketers.

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