63% of Amazon Advertisers Plan to Spend Even More Over the Next Year

Survey says growth rate is higher than with Facebook or Google

Despite rapid growth in Amazon's ad products, only 15 percent of businesses have created voice skills so far.
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Is Amazon’s growing ad business actually a threat to the duopoly of Facebook and Google, or is its potential mostly just hype? A new study from GroupM-owned Catalyst suggests the former.

According to Catalyst’s research, 63 percent of U.S. brands who currently advertise on Amazon plan to up their budget with the platform over the next year. Meanwhile, 54 percent of the same group of brands said they planned to up their Google budgets, while 53 percent planned to beef up Facebook. Another 27 percent of advertisers said they planned to invest in Bing, and 23 percent singled out Twitter for more budgets.

Interestingly, only 15 percent of marketers said that they were using all of Amazon’s advertising products—called Amazon Marketing Services (or AMS). Another 17 percent of advertisers said that they had a fully developed and fleshed-out strategy specific for Amazon.

Per the research, only 15 percent of businesses have created voice-enabled skills on Alexa, suggesting that while voice technology is a growing area of expertise for marketers, it is a relatively small industry. Another 23 percent of marketers said they planned to launch an Alexa skill before the end of 2017.

Catalyst worked with ClickZ to ask 250 business-to-business marketers about Amazon and also surveyed 1,600 consumers about eight retail categories such as clothing, grocery, pet care and home electronics.

In terms of results from the consumer poll, 66 percent of those surveyed said they bought clothing in the past year from Amazon, while 63 percent bought home décor and 64 percent purchased personal-care items. Despite Amazon’s high-profile acquisition of Whole Foods, less than half—43 percent—of consumers polled said that they bought groceries through Amazon in the past 12 months.

After years of dominating online commerce, Amazon has steadily been moving into search, display and video advertising, promising marketers shopper data they can’t get elsewhere.

Amazon offers three ad formats: headline search ads, product-display ads and sponsored products. Some tech vendors are increasingly viewing the search features as differentiators to Google, Pinterest, Facebook and other search engines.

“Whether it’s about brand awareness of down to performance across devices, it just works,” Yoav Izhar-Prato, co-founder and CEO of Kenshoo, said at Dmexco recently.