The rapid expansion of advertising services by global retail giant Amazon continues despie the COVID-19 pandemic.
Amazon posted a 41% jump to $US4.2 billion in revenue generated mostly by advertising in the second quarter compared to the same three months last year.
As a proportion of the whole Amazon business, advertising is still small but growing. Amazon is now ranked third behind Google and Facebook for digital advertising.
Overall, Amazon had set sales of $US88.9 billion, up 40%, in the second quarter.
Amazon advertising revenue is expected to hit $US13 billion by the end of 2020.
eMarketer principal analyst Andrew Lipsman says advertising is a key growth area for Amazon.
"Amazon has strengthened its future position in key growth areas like grocery, health and advertising," says Lipsman.
Amazon’s ad business has attracted increases in spending because advertisers can reach consumers during product queries, a time when they’re ready to buy.
And the company has rolled out measurement and targeting tools, making it even more attractive for advertisers.
In Australia, Amazon advertising launched in April 2019.
“This was another highly unusual quarter, and I couldn’t be more proud of and grateful to our employees around the globe,” says founder Jeff Bezos.
“As expected, we spent over $US4 billion on incremental COVID-19-related costs in the quarter to help keep employees safe and deliver products to customers in this time of high demand—purchasing personal protective equipment, increasing cleaning of our facilities, following new safety process paths, adding new backup family care benefits, and paying a special thank you bonus of over $US500 million to front-line employees and delivery partners.
"We’ve created over 175,000 new jobs since March and are in the process of bringing 125,000 of these employees into regular, fulltime positions."
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