There is no question that start-up ecommerce businesses are seeing smaller expected lifespan than other types of businesses. Amazon has continued the domination of the online shopping space by getting a little more dubious with users of Google search, directing the customers straight to Amazon’s website before they can even see the supplying company’s website.
Amazon has begun to buy up large amounts of keywords through the Adwords feature of Google’s search algorithm, which is in charge of the advertisements that show up before the search results. When a search for ‘North Face’ is done, for example, Amazon’s dedicated page for North Face products now appears before the North Face website.
This is seen as a problem to many digital marketers because of the information that Amazon already collects from its users. Since Amazon knows when certain items are bought, they know when to send out targeted advertisements during the next cycle. Due to the massive amounts of information they are gathering, they can more effectively set up advertisement campaigns, which cuts their costs dramatically.
This is not only manipulative, but also hurts the supplying company, as their Adwords campaigns are no match for the larger Amazon portfolio. Companies are now struggling against their own products on Amazon, as a quick search will now bring a normal consumer to Amazon first.
Because of these more targeted adwords campaigns, most companies are no match to the power of Amazon. Each time a search is done with specific keywords, Google will run an ‘auction’ to determine what organization will get the top advertising spots. But now, it is almost guaranteed Amazon will be at the number one spot.
Amazon is optimizing its own advertising platform as well, which allows certain stores to appear on searches before other ones. Amazon is now one of the world’s largest advertising platforms; Amazon’s reported revenue from advertising in the second quarter of 2018 exceeded $2 Billion dollars.