Google and Amazon are the top two US companies with the highest search ad revenue share in 2019 with Google having as much as 73% and Amazon with 13%. Both these giants are no less than a goldmine for businesses and marketers. If you have to sell a product, these two are your best bet in terms of driving traffic and generating sales.
Google not only has a gigantic search ad revenue share but it is the biggest search engine in the world with 92.71% market share and one of the largest ad networks. According to eMarketer, while the search advertising market share of all the other companies in the US is declining (including Google’s), Amazon’s share is increasing and is expected to surpass 16% by 2021 while Google’s share will plunge to 70%.
Is Amazon becoming the new Google? Will Amazon become the top priority of advertisers in terms of search PPC?
Let’s dig deep and see what data and trends tell us.
Google Ads vs. Amazon PPC
The business models of Google and Amazon are different. Google is a search engine while Amazon is an ecommerce giant. But what makes both platforms attractive for advertisers is their ad networks. Google Ads is the largest ad network that provides advertisers the opportunity to reach their target audience with search and display ads.
Amazon, on the other hand, offers an attractive PPC opportunity to merchants and advertisers who can run ads on Amazon. The users never leave Amazon’s platform, so the product has to be essentially listed in the marketplace. Does it limit Amazon’s ad network potential compared to Google’s?
“Over 50 percent of online retail spend in the US takes place in Amazon, giving the eCommerce giant unrivaled data on purchasing behavior.” Adds Noam Cohen, CEO of Ad Maven, a dominant player in the ad-tech industry, “By leveraging this data, which includes incredibly granular insights on over 100 million Prime subscribers worldwide, they could soon become the biggest advertiser in the world.
Amazon has created an ecosystem in which third-party sellers within their platform compete for relevancy and exposure. New research suggests that nearly half of all product searches in US now begin on Amazon. In a similar way in which companies invested billions to appear in relevant Google searches, the new battleground for Amazon’s sellers has shifted to search results within the eCommerce giant.”
This makes Amazon a perfect choice for merchants and manufacturers, especially when 46.7% of product search starts from Amazon and 34.6% from Google.
Similarities in Ad Networks
There are several similarities between the two companies and their ad networks such as:
1. Ads are triggered by keyword
2. Both the networks are based on cost per click
3. Ads are optimized for conversions
4. Ads are shown above the organic listings
5. Ad rank is based on CPC and ad quality
6. Auction bidding
Both the ad networks work in a similar way. If you have ever run an ad campaign with Google Ads, you won’t have any issues running an ad campaign with Amazon. It’s much easier and straight forward than Google Ads.
There are several differences that make these two ad networks unique. Let’s start with the ad types.
Google offers a wide range of ad types including text, display, responsive, video, shopping ads, retargeted, and more. It has one of the richest ad format types among all the ad networks. There is hardly anything that it misses.
Amazon has limited ad types which include product ads, brand ads, and display ads. Third-party sellers have limited access to ad types so not all sellers can use all the ad formats.
One key difference between the two ad networks (that also related to ad types) is that Amazon never sends traffic to other sites. All the ads you can run on Amazon will promote an Amazon product, so the product has to be listed on Amazon. Google has no such restriction. It sends traffic to any URL as long as it meets their quality guidelines. This provides advertisers with a lot of flexibility.
Retargeting is another differentiator. Amazon doesn’t support retargeting ads while Google’s retargeted ads are pretty famous among advertisers.
Google’s ad ranking system is based on CTR because it wants to deliver an exceptional user experience to its users. Amazon’s ad ranking is based on profitability. Ads that are most likely to result in a purchase will get preference because that’s how Amazon makes money.
Analytics is another differentiator. Google has powerful analytics that lets advertisers track behavioral, demographic, and other key data about their visitors. Amazon doesn’t collect a lot of visitor data and the only that it collects is captured from Amazon’s website which includes purchase history, interests, and other behavioral data.
Amazon Has the Potential but it Won’t be Easy to Beat Google
With all the differences and similarities, it’s evident that Amazon is growing rapidly and has a lot of potential. It’s expanding and is all set to widen its reach. However, it’s hard for Amazon to become the new Google for its primary limitation of being an ecommerce marketplace.
Yes, Amazon could become the biggest ecommerce marketplace in the world and could beat Alibaba in China and Flipkart in India but as long as it remains an ecommerce platform, it’s hard for it to become the new Google.
Ecommerce is a big industry, but it isn’t the only industry. Google’s biggest advantage is that it is suitable for all types of businesses irrespective of their industry while Amazon works for retail, ecommerce, and businesses with physical products.
No matter what, advertisers will continue using Google as it lets them send traffic to their preferred URL. Amazon, despite its growth and increasing search ad revenue, will be the preference of Amazon sellers only. The ad networks and the reach of both networks is enormous.
As an advertiser, you should use both Amazon and Google ads to reach your target audience on both the platforms. If your product is listed on Amazon, you should use Amazon PPC along with Google Ads. If your product isn’t listed on Amazon (or it can’t be), use Google Ads.
Brian Wang is a Futurist Thought Leader and a popular Science blogger with 1 million readers per month. His blog Nextbigfuture.com is ranked #1 Science News Blog. It covers many disruptive technology and trends including Space, Robotics, Artificial Intelligence, Medicine, Anti-aging Biotechnology, and Nanotechnology.
Known for identifying cutting edge technologies, he is currently a Co-Founder of a startup and fundraiser for high potential early-stage companies. He is the Head of Research for Allocations for deep technology investments and an Angel Investor at Space Angels.
A frequent speaker at corporations, he has been a TEDx speaker, a Singularity University speaker and guest at numerous interviews for radio and podcasts. He is open to public speaking and advising engagements.