- Amazon saw promoting sales grow 27% year-over-year for a total of $14.6 billion within the Q4 2023 period ended Dec. 31, per an earnings release. The company’s overall net sales increased 14% to $170 billion within the quarter.
- Viewership for the second season of “Thursday Night Football” on Prime Video increased by 24% year-over-year, with 14% growth within the 18-to-34-year-old demographic, per Nielsen data shared by Amazon.
- Amazon also rolled out a generative AI-powered conversational shopping experience, Rufus, with executives expecting generative AI to drive “tens of billions of dollars” in revenue over the following few years.
Amazon had one more strong quarter with continued growth of its high-margin promoting business. The growth is primarily driven by sponsored product ads, with streaming TV promoting — which recently expanded to Prime Video — growing quickly, executives said on an earnings call.
“The strength in promoting was primarily driven by sponsored products as our teams worked hard to extend the relevancy of the ads we show customers by leveraging machine learning,” CFO Brian Olsavsky said on the decision. “We’re also continually focused on improving our measurement capabilities, which permit brands to see the payback of their promoting spend.”
The company has recently added greater than 15 latest promoting capabilities to boost insights, planning, activation and optimization across its suite of ad products. In the U.S., Amazon recently added a sponsored TV offering that features a self-service solution for brands that has no minimum spend, expanding the reach of the offering. Along with Prime Video, advertisers can reach viewers across Twitch, Freevee and Fire TV.
“Thursday Night Football” continues to be a winner for Amazon, with increased viewership overall and in key demographics through the show’s second season on Prime Video. A Black Friday football game saw viewership increase 24% year-over-year with advertisers seeing “dramatic” gains in ad sales.
“We have increasing conviction that Prime Video could be a large and profitable business by itself, and we’ll proceed to take a position in compelling exclusive content for Prime members,” CEO Andy Jassy said on the decision. “With the ads in Prime Video, we’ll have the opportunity to proceed investing meaningfully in content over time.”
Advertising on Prime Video remains to be in early days, but executives maintain it’s going to be a crucial a part of the business model despite not having heavy ad loads relative to its competitors. Amazon will grow its worldwide Prime membership 10% this 12 months to 317.8 million, with U.S. Prime households up 2.9% to 97.2 million, per Insider Intelligence data shared with Marketing Dive.
Amazon’s latest numbers underscore how the platform continues to dominate amongst retail media networks, an area that Dentsu recently forecast will probably be the fastest growing amongst digital channels in 2024.
Separate from its earnings, the corporate announced the launch of Rufus, a conversational shopping experience powered by the buzzy tech trained on Amazon’s product catalog and knowledge from across the online. Rufus launched in beta and can roll out to the remaining of Amazon’s U.S. customers in the approaching weeks. Amazon is bullish on its growing generative AI ambitions, which has applications across e-commerce, promoting, AWS and beyond.
“Gen AI is and can proceed to be an area of pervasive focus and investment across Amazon, primarily because there are just a few initiatives, if any, that give us the prospect to reinvent so lots of our customer experiences and processes, and we consider it’s going to ultimately drive tens of billions of dollars of revenue for Amazon over the following several years,” Jassy said on the decision.
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