As Amazon shifts attention to further monetizing its platform via advertising, which grew 37% year over year, brands will need to prepare media budgets to support visibility on a platform that increasingly rewards spend with scale.
In the hair category, the average number of first-page sponsored products increased twofold from the first quarter of 2018 to the first quarter of 2019. In the first quarter of 2018, the top ten brands by share of Amazon Advertising listings owned over one-third of sponsored products, compared with just 24% in the first quarter of 2019 according to Gartner L2’s report on the topic. Brands should prepare for Amazon Advertising to become even more crowded as competitors increasingly fight to secure top positions against both branded and nonbranded search queries.
In contrast, Walmart’s on-platform paid search environment is much less advanced, and the e-tailer is playing catch up with its newly created in-house advertising agency. On Walmart, two sponsored products per search, at most, appeared against nonbranded hair queries in the first quarter of 2019. Additionally, ten brands owned over 70% of sponsored product results on Walmart.
Though Walmart’s online ad business is still developing, brands should consider tapping into an advertising platform that is currently less crowded than Amazon’s.