Amazon Could Seriously Compete With Google In Ads By 2020

Amazon has slowly been growing its advertising business, and analysts believe that it could be a $20 billion business by 2020. Which could seriously compete with Google, and even take a pretty big chunk out of its market share. Google currently has virtually no competition in the space, as it holds a huge market share in advertising, with other advertisers like Yahoo and Bing taking a very small amount of the market.

An analyst from Cenkos Securities, Alex DeGroote, believes that Amazon takes up about $3 billion of the US advertising market right now, which is actually around $200 billion. That's just 1.5 percent market share right now, but that could grow to around $20 billion in just two years, if Amazon really expands the business. DeGroote believes that users will head to Amazon for retail searching, rather than Google. And that Amazon could beat Google in search advertising and not display ads. Display ads are those ads you'll see on other sites, that are not search engines. Of course, the antitrust investigations that Google has been facing lately, due to its shopping ads, aren't going to help Google keep this market share and may make it easier to head to Amazon. DeGroote thinks that Amazon "could take Google to the cleaners" in search advertising. And a big part of this is because of the amount of products Amazon lists on its site already.

During its Q4 conference call last week, Amazon's CFO stated that search advertising was a big contributor to its growth in North America in the quarter. Which is likely going to lead to Amazon expanding its ad business in North America. Analysts at Citi believe that Amazon could become a $1 trillion company before Apple does, but that is with bolstering its ad business. Both Amazon and Apple are closing in on the $1 trillion market cap right now. Though Amazon is having some trouble getting close to that $1 trillion mark right now, with the president calling them out in various tweets over the past week or so. Which has shaved over $100 off of its share price in just the past five trading days.

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About the Author

Alexander Maxham

Section Editor
Alex has written for Androidheadlines since 2012 as Editor of the site and traveled the World to many of the biggest Smartphone and Technology events. Alex has a background in Technology and IT and Deep Passion for Everything Android and Google. His specialties lay in Smartphones of all budgets, Accessories, Home Automation and more. Contact him at [email protected]