Report: Amazon Is Google’s Biggest Search Advertiser
Internet Marketing is limited, but companies have been finding ways to generate revenue through advertisements for quite a long time. One of these techniques includes search advertising, which is “a method of placing online advertisements on Web pages that show results from search engine queries,” according to Wikipedia.
Search advertisements target to match the keywords entered on search engines by the consumer. When purchasing something, consumers usually search various options using the search engine to compare their intended buying product before making a final decision. If the consumer is presented with a paid advertisement which has exclusively been modeled according to his/her interests, the consumer is most likely to click on that ad instead of the unpaid search results as they can be irrelevant as well.
The search engine giant, Google, generated advertisement revenues of about $3.31 billion in Q4 of 2013 alone. However, coming to par with its ad revenues is the biggest buyer of Google’s search ads itself – Amazon.
According to Ad Age, the directory shows Amazon is the biggest investor of Google’s search ads, paying $157.7 million in 2013 for search advisement.
Apart from the general revenue it generates, Amazon had fallen prey to the advertisement business as well over the last few years, and just in 2013 alone, it managed to earn $750 million from advertisements. This year, it expects to generate $1 billion from its business of selling search and display ads on its own and others’ sites.
Search ads are a major source of direct marketing and reaching out to the consumer through search engines. Hence, it is no surprise that retailer companies are a major user of this campaign. This year, according to eMarketer, retailers are expected to spend more than double of what other categories spend for digital direct-response ads.
Apart from Amazon topping the list of the top 25 buyers of Google’s search ads, retailers like Walmart and Sears Holding Corps were lying in the top 10. However, the retailers were still relatively lesser in number in the list than expected.
One more category missing from the list is brand advertisers. Recently, Google has been trying to attract more brands to purchase their advertisements to accelerate their revenue. Macy’s, General Motors and Target have already been fished into Google’s net of advertisement, while YouTube seems to be the center of attention by Google for display ads.
Amazon focuses greatly on the searching trends of consumers to target them directly, and similarly spends greatly on search ads. In July 2014, the company spent nearly $19.5 million on Google search ads and $1.2 million on Microsoft Corp.’s Bing search ads, according to the CEO of AdGooroo, Rich Stokes.
“I’m not really seeing any surprises here,” Mr. Stokes said.