Report: 34% of Amazon Sellers Are Increasing Advertising Spend on Amazon in 2021

Jungle Scout, the leading all-in-one platform for Amazon sellers, released its 2021 Amazon Advertising Report, which analyzes data from more than 560,000 ad campaigns and 3,500 brands, agencies, and third-party sellers advertising on Amazon to examine Amazon’s booming advertising business. The report reveals that a significant majority of brands opt to advertise their products on Amazon, and one in three are increasing their ad investments in 2021.

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Key insights from the 2021 Amazon Advertising Report include:

  • Shifts to ecommerce are fueling Amazon’s growth.  
    • Amazon has become the starting point for the majority of shopper journeys; 74% of consumers begin their product searches on the “Everything Store.”
    • Amazon’s ad revenue growth is accelerating. In Q4 2020, Amazon’s ad revenue reached $7.95 billion, up 66% over the previous year.
    • 56% of U.S. consumers say that if they were only able to buy products from a single store, it would be Amazon
    • 37% of U.S. consumers say that while overall spending may be lower than normal, their online spending has been increasing.
  • Brands, agencies, and third-party sellers are pumping investment into Amazon Advertising.
    • Targeting shoppers with ads on Amazon allows sellers to reach potential customers when they are ready to buy, and it’s a strategy most sellers employ already; 75% of sellers use at least one type of Amazon pay-per-click (PPC) advertising.
    • Sellers are investing even more in advertising in 2021; 34% of Amazon sellers plan to spend more on strategic advertising than in past years.
    • Ad spend is shifting from sponsored product ads to sponsored display and brand ads — which see an increased return on investment.

“Advertising has become an imperative aspect of running a business on Amazon,” said Connor Folley, Vice President of Jungle Scout and co-founder of Amazon advertising analytics platform Downstream. “Amazon makes it much easier to attribute a company’s advertising spend to actual conversions — easier than other large advertisers, such as Facebook or Google. Additionally, brands on Amazon can take advantage of the rising popularity of Amazon as a product search engine in order to get more eyes on their products.”

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