From Nasdaq: 2024-05-19 09:30:00

In 2023, Amazon collected $47 billion from third-party sellers on its platform for advertising services, a $10 billion increase from the previous year. The e-commerce giant is now venturing into video advertising, expecting to make significant gains in the ad-supported streaming market. Amazon is positioning itself to capture a large share of the growing ad-supported video market, offering valuable data to advertisers for more effective targeting.

As streaming services like Netflix and Disney+ gain popularity, traditional cable TV subscriptions are declining in the US. Half of US households now use ad-supported streaming services, indicating a shift in consumer preferences. The global ad-supported video-on-demand market is expected to more than double in size by 2030, reaching $71 billion, with North America leading the market. Amazon’s Prime Video service is poised to benefit from this trend, given its large subscriber base and advanced targeting capabilities.

Amazon’s foray into television advertising not only presents a significant revenue opportunity but also helps retain its top e-commerce customers. Prime members spend twice as much on Amazon.com compared to non-Prime shoppers, making it a strategic move to offer ad-supported video at a competitive price. Even if Amazon’s advertising revenue falls short of expectations, the company stands to benefit from increased customer retention and engagement. Investing in Amazon stock may present a promising opportunity, given its expanding business ventures and potential for growth in the ad-supported video market.



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