Amazon to launch mobile ads, in threat to Google, Facebook

Amazon to launch mobile ads in a threat to Google & Facebook

Amazon shoppers, get ready to start being hit with video ads, as the company has apparently decided they represent a potentially lucrative new revenue opportunity. It's no wonder that U.S. giant plans to introduce ads on its mobile apps, as Facebook and Google are already doing it. Indeed, eMarketer predicts that companies will spend nearly $16 billion on video ads alone this year as such content becomes increasingly popular among smartphone users.

Amazon has grown fast in digital advertising market as a challenging competitor after capturing 50% of online sales in the United States. Number of people watching video ads on mobile has reportedly increased, so advertisers have also started to spend on making brief videos snippets which are common on Facebook streams and YouTube. Video ad spots are similar to television commercials and can deepen the power of promotion. Earlier this month, according to a report from Bloomberg, the EC's Vestager said that a preliminary investigation into Amazon's practices is "quite advanced" and that she would "like to take more decisive steps" before her term ends later this year. The site is increasingly a pay-to-play platform, with the top of the page dedicated to the highest bidder, a shift that has helped boost Amazon's profits. People watch video demonstrations and testimonials on YouTube or Instagram which many a times links post to another online shopping websites. Amazon's lack of video content revealed a weakness in shopper engagement and product discovery other sites were doing better. Amazon is requiring a $35,000 ad budget to run the spots at 5 cents per view to run the ads for 60 days, one person said. Bloomberg reports that the ecommerce giant will serve adds to users of its shopping app on smartphones to demonstrate products they search for. However, prices may vary by category.

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The new feature will offer 15-30 second videos in the search result helping shoppers to identify products more easily. "This creates a new format for them and another way to sell space on the platform".

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