Amazon Makes Advertising Change in Potential Challenge to Google

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Amazon is ending an advertising option that has been a favorite of small retailers, according to an email obtained by the Wall Street Journal’s Digits blog.

Product listings at the bottom of Amazon pages that show photos of merchandise and act as links to other retailers’ websites will be discontinued on Oct. 31. These Product Ads, as they have been called, allow brands that don’t sell through the online marketplace to still reach some of its 280 million customers.

These Product Ads, as they have been called, allow brands that don’t sell through the online marketplace to still reach some of its 280 million customers.
These Product Ads, as they have been called, allow brands that don’t sell through the online marketplace to still reach some of its 280 million customers.

A spokesperson for Amazon confirmed the decision to stop selling Product Ads, telling the WSJ that the company is “constantly reviewing the services we offer partners to help them best reach our customer base.”

The current ads will be replaced with simpler text-based ads, appropriately called Text Ads. It’s not yet known how the move will affect Amazon’s advertising revenue. The company typically makes between 10 cents and $2.05 cents per click on Product Ads.

Why would Amazon be willing to potentially sacrifice that revenue? Experts are speculating it may have to do with pushing Google off the site. The search engine giant places a handful of ads on Amazon’s site, and has used them to “glean valuable information about Amazon and its users,” according to the WSJ.

In the past few years, Amazon has made several moves to challenge Google’s dominance of the pay per click advertising market, which is based primarily on selling ads that appear above and to the side of search results (advertisers bid to have their ads appear based on specific search terms, called keywords).

Still, Amazon likely has a long way to go before it will garner the prices advertisers are willing to pay for pay per click traffic from Google. Last month, competitive intelligence firm SEMrush released a chart of the most expensive keywords on Google. The top one, “San Antonio car wreck attorney,” had a cost per click of $670.44.

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