BARCELONA, SPAIN – MARCH 2: The logo of Amazon Advertising, the advertising solutions service formerly known as AMD or Amazon Marketing Services, during Mobile World Congress 2023 on March 2, 2023, in Barcelona, Spain. (Photo by Joan Cross/Noor Photo via Getty Images)
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Amazon I turned to the Internet To the tyrant In recent years, brands have paid big bucks for premium placement on retailers' websites. Now, Amazon allows other sites to use its advertising technology for their own stores.
Amazon said Thursday that the new offering, called Amazon Retail Ad Service, allows companies to show “contextually relevant ads in the right place at the right time” in search results, product pages and other areas on its site.
It's initially available to US retailers, who will pay fees based on usage levels. Prices were not revealed.
Amazon In 2022 It began reporting advertising revenue in its quarterly earnings reports, showing that the company had become a significant contributor to the company's top and bottom line. Advertising revenue in the latest quarter was $14.3 billion, ranking third alphabet and dead In digital advertising.
This is still far less than the sales Amazon generates from online stores and cloud computing, which were $61.4 billion and $27.4 billion, respectively, last year. a fourth Which ended in October.
The bulk of Amazon's advertising revenue comes from Sponsored Product ads, which are keyword-targeted ads that allow brands to promote specific items. Amazon He stuffed more of these sponsored items In search results and product pages over time. It also generates some advertising revenue through streaming.
With Amazon Retail Ad Service, users will be able to customize the layout, placement and number of ads displayed across their sites, as well as use Amazon's ad measurement and reporting tools.
The service could provide Amazon with valuable data that it can use to enhance its ad prediction and recommendation technology. The company said early customers include health and wellness retailer iHerb, Asian grocery startup Weee! and Al Sharqiya Trading Company, which sells toys, party supplies and handicrafts.
“We designed this to be a win for retailers, advertisers, and shoppers, and we look forward to seeing how we can improve results, increase sales, and enhance the shopping experience,” said Paula Debbins, vice president of Amazon Ads Measurement. Press release.
The announcement comes just days before the National Retail Federation Annual trade fair.
This is not the first time Amazon has sold its internal technology and services to third parties.
Amazon Web Services started as a cloud infrastructure to support online retail businesses. The company launched AWS as a business in 2006. In 2022, the company launched Launched Buy with Primewhich combines Amazon's payment and fulfillment services for other retailers.
