Amazon’s growth as an advertising platform continues to disrupt the digital media landscape as the online e-commerce giant’s share of global digital ad spend is set to reach 8% by 2023, up from 3% last year, according to a new report “Future Digital Advertising: Artificial Intelligence & Advertising Fraud 2019-2023” from Juniper Research.
The report forecasts that Amazon’s advertising revenues will reach $40 billion by 2023; a growth of 470% from its advertising revenues in 2018. This is all due to the retail giant’s large source of consumer data as it plans to leverage its retail data and heavy investment in machine learning to offer efficient targeting and attract users from the established duopoly of Google and Facebook.
Speaking of which, Google’s advertising revenues will exceed $230 billion by 2023. Despite this, it forecasts that the company’s global market share of digital advertising spend will fall 1% over the next four years due to the growth of competing platforms, including Amazon and Baidu.
Meanwhile, digital ad spend worldwide is forecast to hit $520 billion in the next four years compared to an estimated $294 billion this year, with an average growth rate of 15% annually for the next five years. Juniper believes a key driver is the growth of programmatic ad platforms and related technologies that can deliver highly targeted ads. As a result of these efforts, 75% of global online and mobile ads are forecast to be delivered via AI-based programmatic advertising by 2023.
“Giving algorithms access to the vast amounts of data generated by advertising traffic, including purchasing habits, user buckets and geographical location, is critical to enabling advertisers to secure a return on their ad spend,” said research author Sam Barker.