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According to the latest forecast from research firm eMarketer, Amazon is expected to progress in the ranking of the best US advertising advertisers in 2018 to take third place, thanks to the acceleration of growth in advertising revenue and accounting changes of the company.
Technology giant expected to generate $ 4.6 billion in advertising revenue in the United States
Verizon Communications
Inc.
VZ -0.57%
Oath and
Microsoft
Corp.
MSFT 0.95%
in the eMarketer ranking, while significantly following the heavyweights of the industry,
Alphabet
Inc.
GOOGL 0.63%
Google and
Facebook
Inc.
according to eMarketer.
According to EMarketer, Amazon will hold a market share of 4.15%, compared to a previous estimate in March that the company's share would be 2.7%. The search firm cited Amazon's "strong organic advertising revenue growth" for adjusted forecasts, as well as Amazon's accounting changes.
Accounting changes, related to the reclassification of certain advertising services from cost of sales to turnover, accounted for most of the eMarketer adjustment. In terms of growth alone, the forecaster would further increase its forecast of Amazon's market share and move the company fourth behind Microsoft.
Amazon attracts advertisers looking for insight into the impact of their ad purchases on their purchases. Amazon, unlike Google and Facebook, has this purchase data, said Monica Peart, Senior Director of Forecasting at eMarketer.
Google and Facebook are still far ahead of Amazon and the rest of the pack. According to eMarketer, Google and Facebook will control this year 58% of the digital advertising market in the United States, for a total of 64 billion dollars.
Amazon's increased search traffic to consumers looking for products on its site has also boosted its advertising activities, giving third-party sellers a reason to spend more on Amazon's keywords, Peart said.
With the new technology systems, Amazon has also made it easier for advertisers who do not sell products on Amazon to buy ads. "We see a bigger call for advertisers than we expected," she said. "This is one of the main reasons why we could have underestimated the kind of growth that would be achieved in the first half of the year."
Amazon's "other" category revenue, which includes primarily advertising sales, more than doubled in the June quarter year-over-year to $ 2.19 billion.
Existing Amazon merchants and brands are among the customers buying ads on the site, as well as authors and other advertisers targeting Amazon customers.
EMarketer also expects Amazon to increase its mobile advertising revenue by 242% to $ 1.61 billion in 2018, giving it a 2.1% share of the mobile advertising market.
Write to Alexandra Bruell at [email protected]
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