Amazon attacks the search engine market

Amazon attacks the search engine market
25.01.2019 Kathrin Kempf
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Amazon used to stand for eCommerce and Google for search engine marketing. In the last two blog articles (“How was Amazon doing in 2018?” and “How was Google doing in 2018?”) we have already seen that the clear boundaries between the two Internet giants are blurring. On the one hand, they compete in new business areas such as health or mobility. On the other hand, they also attack each other’s core business. Google invests in eCommerce applications. And Amazon Marketing has quietly and covertly become the heavyweight in product searches on the Internet.

For many customers, Amazon is the starting point for searching for specific products on the Internet. In addition, the most prominent product search results on Google very often link to Amazon. But only few retailers and brands already make use of these marketing options. Conversion rates and CPCs are therefore very competitive.
iq! has investigated the potential and advertising opportunities on Amazon.

Amazon Marketing – the Figures

According to a study by Survata Survey, almost half of all searches for products took place at Amazon in 2017. In contrary, all search platforms together accounted for only 35.5%. This makes Amazon the most important Digital point of contact for prospective buyers.
Consumer-product-search

The sources for consumer product search
Source: Forrester Report, Survata Survey

This importance is also reflected in Amazon’s sales figures for advertising: in 2018, approximately 4,5 billion dollars were generated. It is estimated, that the Advertising volume could reach around 6,6 billion dollars in 2019. This is still a dwarf size compared to Google, which generates around 100 billion dollars a year with advertising. But the sector is growing rapidly and is likely to have great potential in the near future.

In addition to the search queries for products on Amazon, it must be added that the Amazon site often occupies a top position in product queries via Google (among the top 3 in over 70% of cases). SEO and SEM via Amazon is therefore extremely worthwhile for retailers and manufacturers.

Ranking-Amazon-products

Position of Amazon products on Google Rankings
Source: Rockstars Report, June 2018

Amazon Marketing – the Options

Basically, there are three possibilities to advertise via Amazon or to promote the sale of products. The first and most obvious is to operate SEO on Amazon’s own product pages in order to 1. achieve a good position in the Amazon hit list and 2. achieve a high ranking in the Google results.

 

Secondly, three different forms of online advertising can also be booked on the Amazon portal:

  • Sponsored products appear in the hit lists after entering a keyword, with the small note “sponsored”. Places are allocated via a CPC auction; the more you bid, the further up you are positioned. A similar principle as SEM via Google.
  • When booking Sponsored Brand Ads you get a whole area, either across, in the middle or below the hit list. Here, a brand can place several of its products next to each other more prominently
  • Product display ads appear later in the booking process, on the product detail pages, and take the form of (smaller) online banners. They can either be used to draw customers’ attention to other products of one’s own brand shortly before the purchase is concluded. Or to advertise consciously your own article with competitive products.

The third option is to book advertising on third-party platforms via Amazon’s marketing area, e.g. on YouTube, Facebook or in a Newsletter.
Amazon-Marketing-Options

Overview of Amazon Marketing Programs 
Source: iq! based on Amazon information

Amazon Marketing – Conclusion

The marketing options at Amazon are still underestimated by many market participants. Both the costs and the conversion are very positive, also because of the lower booking rates. Marketing on the Amazon platform is extremely purchase-oriented and therefore very efficient. In addition, the eCommerce provider (unlike Google) offers access to detailed data on the purchase history and purchase behaviour of customers. This is a decisive advantage in online marketing.

One reason why the offers are less accepted than the booking possibilities of the search engine operators is the lack of supporting agencies. The agency landscape is also just beginning to adjust to the growing Amazon Marketing sector.

iq! advises all retailers and brands to deal with the Amazon Marketing channel and sort out their own options. Best before the competitive pressure in this area increases.

 

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