Amazon’s ‘Full-Funnel’ Ad Business Keeps Growing

close up shot of an electronic device
Photo by Anete Lusina on Pexels.com

Nothing can stop Amazon.

The company reported its Q4 2024 numbers this week, with Advertising Services revenue hitting $17.30 billion for the quarter—an 18% year-over-year increase from $14.33 billion in Q4 2023. Growth for the full year was steady, with each quarter posting double-digit YoY gains, though at a slowing pace—from 26% in Q2 to 18% in Q4.

Here’s a look at the raw numbers:

On the earnings call, President and CEO Andy Jassy delivered a solid summary of the Amazon Ads sales pitch—it’s a full-funnel advertising solution from top to bottom. Here’s the money quote from those remarks:

“We’ve made it easier to do full-funnel advertising with us. Full funnel is from the top of the funnel with broad reach advertising that drives brand awareness to mid-funnel sponsored brands let companies specify certain keywords and audiences to attract people to their detailed pages or brand store on Amazon, to bottom of the funnel, where sponsored products help advertisers service relevant product ads to customers at the point of purchase. We make this easy for brands to sign up for and deploy across our growing advertising. We also have differentiated audience features that leverage billions of customer signals across our stores and media destinations.”

So, what does this funnel look like? We tried to visualize it here: 

Why This Matters:

Amazon’s rise in digital advertising has fundamentally reshaped the industry. According to EMARKETER, Google and Meta’s combined market share fell below 47% of digital ad spend in 2024, while Amazon’s piece pushes the top three’s total above 60%. 

Amazon also benefits from being at the center of two huge trends driving increased spend: streaming/CTV and commerce/retail media. And, to Jassy’s earlier point, it’s difficult to replicate the full-stack ecosystem Amazon has. No other company brings together direct consumer signals, vast ad inventory across the funnel, and ecommerce integration at Amazon’s scale. 

Experts React:

We’ve talked about Amazon’s numbers at a high level, but it’s also important to acknowledge their tech advancements. There has long been a perception, for example, that Amazon DSP lags behind competitors like Google and The Trade Desk in terms of innovation and capabilities. However, that seems to have changed over the past year, as Amazon has made major improvements to boost the platform. 

To that point, check out this great thread by Programmatic 101, highlighting the new features they’ve seen.

Our Take:

The shocking thing here, really, is that Amazon’s ads business has only just begun. They have a ton of room to grow. (Prime with ads is barely a year old and has already reshaped the market.)

Amazon also has access to a wealth of ecommerce data, which can be a key driver of AI-powered upgrades in ad targeting, personalization, and measurement. Unlike most of its competitors, Amazon’s data isn’t just from web behavior—it’s transactional, allowing for direct insights into purchasing intent. It’ll be tough to beat. (We don’t work for or with Amazon, we swear!)

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like