Amazon’s annual ad spend accounts for about 2% of ad expenditure worldwide.
Amazon – the E-commerce giant, has become the biggest advertiser on the planet Earth. Amazon disclosed in its annual report that the company’s ad expenses reached $11 billion equal to £8.4 billion.The company’s ad spend shows a yearly increase of 34%, which makes $2.8 billion.
The online retailing giant rapidly enhanced its expenditure on ads and promotions of our services and products more than its net sales. The annual report shows that net sales of the company boosted to 20%, equivalent to 280.5 billion. Amazon yearly report says,
“We bring customers to our stores primarily through several marketing channels, such as our sponsored search, third-party customer referrals, social and online advertising, television advertising, and other initiatives.”
Amazon – a regular advertiser during US Super Bowl:
Amazon came to be a daily advertiser during the United States (US) Super Bowl game. The company used Droga5 London – a New York-based advertising agency to make an ad for US Super Bowl. Droga5 London is an acquired agency of a well-known New York advertising agency, Accenture Interactive. The advertising agency made an advertisement for the US Super Bowl game this year featuring Ellen DeGeneres. She is an American comedian, writer, actress, and show host.
Other ad agencies serving Amazon:
Over recent years, numerous ad agencies have performed their duties on Amazon’s creative. These include:
Moreover, amazon relies on Interpublic’s initiative for handling the buying of global media. Interpublic, known as the Interpublic Group of Companies Inc. (IPG), is a publicly-traded advertising agency in America.
Amazon contributes about 2% of global ad spend:
Jeff Bezos founded Amazon in 1994. The e-commerce company has increased its ad expenditures about 20-fold in a decade. According to the company’s filings, its ad spend was $ 593 million in 2009, which increased to $ 3.3 billion in 2014. Now in 2019, Amazon’s ad expenditures hit $ 11 billion.
The way Amazon is scaling its ad spend indicates that it has beaten up Procter & Gamble and Unilever – consumer packaged goods giants. Now the company has become the top-most advertiser of the world.
Before Amazon, Procter & Gamble (P&G) had the title of the world’s biggest advertiser. But P&G reported a fall in its ad expenditure of $ 350 million to $ 6.8 billion in the year 2019. The general, selling, and administrative expenses, including marketing-related and other costs of the company was $ 19.1 billion.
Brian Wieser’s insights:
Brian Wieser is the president of global intelligence at Group M of Wire and Plastic Products (WPP). WPP is a multinational advertising, technology, communications, and public relations holding agency. According to Wieser,
“Amazon is likely the biggest advertiser on Earth, accounting for nearly 2% of all spending.”
Amazon’s most important markets:
The company has its four most important markets in:
Amazon subsidiary brands:
The company has the following subsidiary brands:
Perceptions of Amazon annual report:
The annual report of the company reveals that it spent $ 11 billion for advertisement and $ 7.9 billion for other marketing sectors, making a total marketing expense of $ 18.9 billion. The report assumed,
“Marketing costs include advertising and payroll and related expenses for personnel engaged in marketing and selling activities, including sales commissions related to Amazon Web Services.”
The report further explained,
“While costs associated with Amazon Prime memberships and other shipping offers are not a part of marketing expense, we view these offers as effective worldwide marketing tools and intend to continue offering them indefinitely.”
Amazon – a significant media owner:
Amazon has offered ad space on its website and thus has become a considerable media owner in recent years. According to the company, it produced $ 14.1 billion as profit mainly from ad sales. However, this profit also included revenue earned from other service offerings. Earlier, the figure was up 39% annually. eMarketer is a data and research source for digital marketing, commerce, and media. It now ranks Amazon in the fourth position in the world following Google, Facebook, and Alibaba by digital ad sales.
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