The advertising business of online giant Amazon is likely to wrest the market share of search giant Google by end of this year as per estimates by research firm eMarketer. The study declared that Amazon will increase its share in digital ad spend of US by 8.8% from level of 6.8% that it had achieved in 2018. By the end of 2019 it will reach 19% and most of this would have been from Google’s market share which is expected to lose its position steadily by 1% every year.
The study predicted that Facebook will be able to increase its foothold in digital ad expenditure in 2019 to 22.1% by moving up from 21.8%. These growth predictions are a boon for advertising segment of Amazon that offers another revenue stream for its coffers apart from existing growth engines of e-commerce and cloud business. Revenue in this category of Amazon is primarily made up of advertisement sales which have more than doubled between 2017 and 2018. According financial filing made by Amazon last year its advertisement sales earned revenue of $10.1 billion last year while its net sales amounted to $233 billion.
According to this study Amazon’s US advertisement business will grow by 50% this year based on other revenues category of the firm. This category has led to increase in revenue predictions of Amazon between 2018 and 2021 by several billion dollars as it had earlier predicted ad revenue of 2019 to be around &7.28 billion but now expects it to hit $11 billion or upwards. This was because according to a recent CNBC report a few advertisers in the consumer packaged goods category have moved more than half their search budget to Amazon from Google. Of the five firms that it studied only Amazon and Facebook were expected to improve their market share in 2019.