While everybody is focused on Amazon’s retail business, one of its most exciting and perhaps profitable revenue sources is advertising. In this video interview, L2 Founder Scott Galloway speaks about how Amazon is on its way to becoming the world’s largest media company. Amazon is the sixth most trafficked site in the world, and it is closer than any media company to the final step of consumers’ path to purchase. Forrester research shows that 30% of people start their search for a product on Amazon versus 13% on Google. Galloway says Amazon ads are incredibly powerful because Amazon has more user data than any other media company in the world. Amazon might know that a certain customer buys blush only when it is on sale, but needs only a 10% discount to purchase. Furthermore, clicking on an Amazon ad will take the consumer to the product page where items can be on their way with a click. Galloway says no other company has vertically integrated from media to sales like Amazon has, which makes a strong pitch for selling ads.
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