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Tags: Financial Markets | Infrastructure | Money | digital ad sales | Apple Inc. | Google | Alphabet

Amazon, Google Digital Ads Triumph Over Apple Privacy Rules

Amazon
(AP)

Wednesday, 27 October 2021 08:41 AM

Amazon.com is expected to emerge as a winner in the digital advertising arena, surviving Apple's privacy changes better than rivals Facebook and Snap. Google, also, just posted a record earnings quarter, with its digital ads driving its profits.

In both the case of Amazon.com, and in the case of Google, these technology giants are relying on their own vast databases on customer shopping -- instead of having to rely on Apple's iOS mobile operating system's tracking information.

Google's Ad Revenue Soars by 41%

For both Amazon.com and Google, not having to rely on Apple as a gatekeeper to their customers, is a game-changer.

Google parent company Alphabet Inc. -- which also collects a rich set of data from users' search habits -- reported a 41% surge in Google advertising revenue, a sign that businesses that rely less on targeted ads are able to overcome Apple's limits on tracking mobile users.

As The Wall Street Journal's headline and lead Tuesday put it: "Google Poised to Ride Hot Ad Market to a Record Quarter: Google is expected to report historica sales growth in the third quarter, as smaller businesses pour money into digital ads in pursuit of customers whose purchases have shifted online."

Amazon, which reports earnings on Thursday, does not break out its advertising sales, but nestles it in its "other" business segment.

"Google and Amazon require a user to already be looking for something, therefore aren't as reliant on cookies," Eduardo Cruz, performance marketing manager at SupplyKick.

"For brands selling a physical product, Amazon Ads are a powerful way to drive purchases, increase product consideration, and reach customers."

Apple's advertising business has surged since it prevented advertisers from tracking iPhone without their consent in April, eating into market share once occupied by Facebook, Instagram and Snap.

The iPhone maker will report fourth-quarter results on Thursday.

Most Facebook users access the social networking platform through a mobile device, with nearly 15% of adults using iPhones and iPads in July, according to data firm Data Reportal.

Twitter, which relies on targeted ads but not as much as Facebook, reported advertising revenue in line with estimates.

Wall Street analysts said since the majority of advertising on Twitter comes from Brands, especially services or digital, as opposed to Direct ads, the company was better positioned to overcome the privacy changes than Facebook or Snap.

To be sure, the digital advertising market is still booming exponentially as the pandemic led to more consumers shopping online and spending more time on social media. Like Facebook and Snap, Google's YouTube saw a modest hit, the company said, primarily in direct-response advertising.

"This is the early innings of a shift that will play out over several quarters," Andrew Lipsman, eMarketer principal analyst at Insider Intelligence, said.

"The strength that we've seen in the past few quarters has remained, but it is starting to shift a little bit between the different players."

© 2021 Thomson/Reuters. All rights reserved.


StreetTalk
Amazon.com is expected to emerge as a winner in the digital advertising arena, surviving Apple's privacy changes better than rivals Facebook and Snap. Google, also, just posted a record earnings quarter, with its digital ads driving its profits.
digital ad sales, Apple Inc., Google, Alphabet, Amazon.com
483
2021-41-27
Wednesday, 27 October 2021 08:41 AM
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