Amazon To Introduce Video Ads To Its Mobile App

Gerald Bowen
March 24, 2019

Interestingly, the e-commerce channel already hosted a series of videos like product videos, buying guides, DIY, and how to's and the video ads are said to be a part of the same.

Amazon shoppers, get ready to start being hit with video ads, as the company has apparently decided they represent a potentially lucrative new revenue opportunity.

Based on full-year data from both companies and the rest of our analysis of the USA ad market, we now estimate that Google's share dropped less than we anticipated (1.4 points), and Facebook's share grew more than we predicted (2 points).

For the record, Amazon has emerged as a fast-growing competitor in the digital advertising market as it dominates 50% of all online sales in the U.S. As per people familiar with the product, Amazon is recommending 15-30 second videos, adequate for a shopper who is browsing search results. Indeed, eMarketer predicts that companies will spend nearly $16 billion on video ads alone this year as such content becomes increasingly popular among smartphone users. Digital advertisingmarket share of Amazon will increase from 6.8 percent to 8.8 percent in 2018, while Google will drop from 38.2 percent to 37.2 percent.

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Operating an ad platform on top of a service like search or social media or retail sales opens firms like Google, Facebook and Amazon to additional anti-competitive charges.

Amazon began adding more product-related video content to the site two years ago to prevent shoppers from defecting to YouTube and Instagram to watch video demonstrations and testimonials from influencers not found on Amazon. Bloomberg is reporting that the company is beta testing putting ads on its mobile apps. The initial sense was that any kind of advertising might be seen by the customers as a distraction to their main intention of shopping on the site.

Reportedly, Amazon has decided ad budget of $35,000 to run spots for 60 days at variable price of 5 cents per view depending upon the category. "This creates a new format for them and another way to sell space on the platform".

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