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Tom Denford and David Indo of ID Comms: how Amazon will break the duopoly

On this week’s #MediaSnack Tom and David look at the giant opportunity ahead of Amazon to bust open the much-feared ‘duopoly’ of Google and Facebook.

The duopoly has accounted for almost all the growth in digital media spend in recent years and looked unstoppable.

Finally, it seems Amazon is taking the advertising business seriously.

The company has already seen rapid growth, albeit from a small base and more likely now to challenge and perhaps even defeat the duopoly.

Tom and David examine the comparative sizes of these three tech giants and compare their ad revenue businesses, their opportunities and predict their respective fortunes across the coming three years. In short, they predict that Amazon’s advertising business will overtake that of Facebook in revenue terms in 2020 and take a huge chunk out of Google’s search revenues in the process.

David argues that Amazon has all the pieces of the puzzle ready; It watches and learns before disrupting and will have learned a lot in the last couple of years as Google and Facebook have been subject to far greater scrutiny by advertisers. Amazon has already secured a good share of promotional budgets and has access to user purchase data, which is highly valuable to advertisers, and we expect it to expand brand marketing products in time.

It is also beginning to dominate product search in some markets while Alexa is adding voice search. Also, important for many marketers will be Amazon’s reassurance over brand safe environments and controls on ad placements.

Tom and David conclude, however, that Amazon’s winning ingredient is the company’s total commitment to its customers and reinvesting all profits back into products which delight customers (in this case advertisers). They argue that full transparency and market-leading people, service and tools will be able to steal away huge ad dollars from other vendors.

On this week’s Good Week Bad Week Tom and David celebrate the latest update from UK marketing trade body ISBA, which has revealed that a large cohort of their members have implemented their rigorous media agency contract template and much more are expecting to do so soon.

A very bad week for mobile agency Fetch – owned by Dentsu – which has been subject to a lawsuit filed by Uber in San Francisco claiming breach of contract. The claim list is brutal and Fetch will need to fully and quickly address the issues in public.

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