Amazon's ad flywheel mechanism: $18.9 billion in traffic from Google and Facebook to get more sellers to advertise.
In recent years, Amazon has invested more and more in marketing to divert the platform and expand its consumer base.
In the first quarter of this year alone, Amazon invested.$4.8 billion in marketing funds generated $3.9 billion in revenue, or 81 percent of marketing costs, through advertising by sellers.
Amazon's advertising revenue is insufficient to offset marketing spending, but the proportion is rising sharply year after year.
Amazon."Advertising flywheel" is the cycle of advertising revenue and marketing spending. Amazon invests in marketing campaigns such as buying traffic on Google and Facebook platforms (marketing spending covers event expenses, employee salaries, marketing staff-related costs, etc.), diverts the platform, expands its consumer base, and then attracts more sellers and brands to buy Amazon ads, including PPC ads, sponsored product ads, sponsored brand ads, display ads, and so on, and then Amazon uses it to generate revenue from advertising to offset marketing costs.
Frontline learned that, at present, Amazon's advertising revenue is still lower than the total marketing cost expenditure, but from.Beginning in 2015, advertising revenue as a percentage of marketing costs, showing a rapid growth trend,In the near future, Amazon's advertising revenue is expected to outstrip marketing spending.。
Amazon's advertising revenue accounted for only 32% of marketing costs in 2015, rising to 41% in 2016 and 46%, 73% and 75% in 2017-19, up from 81% in the first quarter of this year.
(Data source:Marketplace Pulse）
Amazon saysIn 2019, the company invested $18.9 billion in marketing, accounting for 6.7% of the company's total revenueand was the highest proportion ever, than.Marketing costs increased by 37% in 2018. In the same year, Amazon's advertising revenue reached $14 billion, a record year.
Facebook's advertising revenue is more than six times the cost of marketing, and Google's is more than five times that.
Amazon's advertising revenue is not enough to offset its marketing costs.Facebook's advertising revenue has exceeded six times the cost of marketing (626%), and Google, the global advertising platform, has far more advertising revenue than its marketing spend, which is 5.44 times higher than the latter'. Of course, as more sellers buy ads for their products and brands, Amazon's advertising revenue will continue to grow dramatically and then exceed marketing costs.
Amazon is one of the world's largest advertisers for Procter and Gamble, Samsung, L'Oreal and Unilever. The first line learned thatAmazon has become the world's third-largest advertising platform, after that.Facebook和Google。Of course, in terms of ad traffic, Amazon is associated with Google and.The gap is still large, mainly because the vast majority of Amazon's ads are retail-related and less widely available than the other two platforms, but its advertising network is growing faster.
It is also mentioned above that Amazon's marketing spending is partly spent.On Facebook and Google, buy traffic from both platforms and sell them to brands or sellers. Amazon has become one of the biggest advertisers on facebook and Google, FirstLine learns.(The first line of text/cross-border e-commerce)The end of the text sweep code. Exchange group, docking cross-border e-commerce high-quality resources.
Go to "Discovery" - "Take a Look" to browse "Friends are watching"
send to have a look.