When it comes to online advertising, Google and Facebook (Meta) are the kings. This has been the case for years, with nothing knocking them off the mantle.
We know that YouTube and the Meta family of social media applications have more than a billions users. This is compounded with targeted advertising that is drawn from the data mining these companies do.
It is a difficult combination to combat. That said, we might be seeing a shift.
Image generated by Ideogram
The Shift In Online Advertising
When we look at Google and Meta, they have users. In spite of having a lot of them, they are still users.
It seems that advertisers are changing the script. They do not want users. Instead, the hunt is for customers. The question is how has that?
Here is where we simply follow the dollars to get the answer. It actually is rather sensible when you give it a bit of thought.
A lot of the money is starting to move towards retail media networks. This includes something such as GSTV along with within the Walmart and Amazon ecosystems.
It has become so powerful, we see how this is shaping up:
Of the companies eMarketer tracks, Amazon was considered the biggest retail media network in the U.S., with a roughly 75% share of retail media ad revenue. Other top networks by revenue include Walmart, Instacart, eBay
and Etsy.
This should come as no surprise.
Basically, we are looking at advertisers buying ads on these companies websites (along with in-store). Instead of going with the social media sites with billions of users, these entities are looking to go where their products are sold.
The advertising dollars are now shifting in this direction and at a rapid pace.
Global retail media ad spending is expected to more than double from $114.18 billion in 2023 to $233.89 billion in 2027, according to eMarketer. Retail media is expected to represent a larger percentage of digital advertising spending, which has begun to eclipse traditional media spending, growing from 18.9% of that segment in 2023 to 25.7% in 2027, according to eMarketer.
This is a market that is expected to double over the next few years. Notice how it is going to eclipse traditional media spending.
The Opportunity
A shift of this nature opens things up for everyone else.
Status quo is the worst things for newer entrants. As we grow Web 3.0, this is an opportunity that can be leverage by emerging platforms.
What is going to pull in this revenue is going to be determined. It is obvious that the trend is towards those platforms that have commerce.
Consider the power that Amazon offers to advertisers.
It is the #12 sites globally and #5 in the United States. This is impressive when we consider it is neither search nor social media. In spite of this, it is right behind Google, YouTube, FB, and Yahoo in the US.
The fact that this is a commerce site, selling products makes it highly appealing to advertisers.
Consider the business model that is being employed here:
Amazon gets paid by companies to advertise their products on the website, pulling in revenue. If people purchase the product, Amazon also makes money off the sale.
Is it any wonder the company is cleaning up?
There is a lesson there for all other platforms.