“As of 2023, Google estimates that Amazon’s revenues are larger than Google’s in retail advertising,” according to Jerry Dischler’s, Vice President & General Manager, Ads Team at Google, testimony in U.S. Justice Department’s case against Google.

Amazon is the third largest digital advertising platform, behind Google and Meta (Facebook). Google’s $251 billion advertising business is five times larger than Amazon’s. However, Google and Meta host ads for many other industries besides retail. Amazon, on the other hand, does little business with non-retail advertisers. Google’s testimony and industry estimates confirm Amazon as the largest retail advertising network.

Google and Meta are the primary channels for buying ads that drive traffic to a brand’s website. Ads on Amazon drive shopper intent to a brand’s product. Ads on Google and Meta are at the top of the marketing funnel early in the decision process, while ads on Amazon are near the bottom when the shopper is ready to buy. Thus, the price, target website, and conversion rate are significantly different. Some would even categorize one as “advertising” while the other was a “toll.” Fundamentally, they serve the same function — they buy brands access to shoppers.

Over the past four quarters, Amazon sold $51 billion worth of ads — four times more than five years ago (more than twice the growth rate of Google’s ad business). The ads business has grown faster than GMV as the company added more ads, more ad types, and more data for advertisers. During that growth phase, Amazon transitioned from a sales channel to a pay-to-play retail platform.

Because Amazon accounts for at least 40% of U.S. e-commerce and because ads have taken over it, brands are spending more dollars to get in front of Amazon’s shoppers than to drive traffic to their websites. That’s true only in aggregate, naturally, as most big retail ad spenders like Walmart and Temu are not in the same group as Amazon’s top advertisers.

Amazon is not replacing Google for retail advertisers, but this shows Amazon’s relative scale as an ad network that didn’t exist less than ten years ago. As Amazon continues to expand its advertising ambitions, its ad network is less about taxing shopper intent on Amazon and more about using shopper data to target ads on and off Amazon.