Amazon Emphasizes Brand Advertising Ambitions In Q4 Earnings

Amazon’s advertising business grew by about 40% year over year, in line with the annual growth of the overall “Other” segment, CFO Brian Olsavsky told investors during the company’s Q4 and year end 2019 earnings call Thursday.

Advertising revenue is still a drop in the bucket compared to the $280.5 billion the entire company brought in during the year (up more than 20% from a year ago). But it represents an important way for non-Amazon brands to deepen customer relationships, Olsavsky said.

For instance, more brands are creating multi-page online storefronts or curated product feeds, he said.

Amazon advertising lets brands “tell customers who they are” and creates chances for brand loyalty beyond people being Amazon shoppers, Olsavsky said.

That brand focus is driving Amazon’s performance advertising business as well, a message the company stated at AdExchanger’s Industry Preview conference Wednesday.

Amazon ad products are known for generating immediate sales, said global VP of performance advertising Colleen Aubrey at Industry Preview.

Despite those aspirations, Amazon’s true power is its closed-loop purchase data, which sets its ad division up for growth.

“Broadly speaking, with advertising so much of this is about the fidelity around shopping outcomes,” Olsavsky said. “And we’re uniquely positioned to do this.”

Amazon doesn’t regularly disclose user numbers for services like Prime and Fire TV, but it spiked the football this quarter with 150 million Prime subscriptions worldwide and more than 40 million households with the Fire TV OTT platform.

Shares shot up in after-hours trading Thursday evening, pushing the company back into the trillion-dollar club, after the company reported unexpectedly high sales, profits and user numbers in its Q4 2019 earnings call.

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