Google Danger! Amazon's advertising business is worth or exceeds trillions in the next few years
Amazon could eat into Google's advertising business
According to a recently released market research report, Amazon could capture a significant portion of Google's business, Investopedia reported on April 6.
Daniel Salmon, an internet analyst at investment firm BMO Capital, estimated in a research report that Amazon's advertising business will be worth 1033.6 billion yuan in 2024 and that amazon's advertising revenue "could reach" 14.6 billion yuan in 2016.
Amazon could eat into Google's digital advertising market share as its advertising business grows. Salmon has lowered its revenue forecast for Alphabet for 2017 to 743 billion yuan from 746.6 billion yuan. In addition, he adjusted Amazon and Alphabet's target share price, raising Amazon's target price by 2,067 yuan to 8,269 yuan, and lowering Alphabet's target price to 5,513 yuan from 7,235 yuan.
Despite its e-commerce and cloud computing businesses, there are media reports that Amazon is quietly stepping up its efforts to attract advertisers. Amazon is understood to have launched a number of advertising tools to attract brands interested in its platform. The tools are designed to compete with similar products from rivals such as Facebook and Google, or to highlight Amazon's unique skills in product advertising. Amazon, for example, says consumer data obtained through its e-commerce platform is unmatched by other vendors and helps meet the need for brands to run ads on their or other sites.
Amazon's biggest opportunity, Salmon wrote in the report, is in "Sponsored Products", or in ads that appear when users search for specific products, "usually, people who visit Amazon have an intention to shop." This is invaluable for brands and businesses that want to be noticed by shoppers with strong buying intentions, so we believe Amazon's Sponsored Products offer a very attractive return on investment for advertisers. "
At a meeting in January, the head of WPP, the world's largest communications group, said the companies Google and Facebook needed to worry about were Amazon. Salman said the WPP's branch in Seattle was "a problem." We've also called on other communications group executives who say their recent partnership with Amazon is on the rise."
(Source: Phoenix Technology)
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