Amazon's data could rock online advertising

Posted by Rob Lewis

This morning Om Malik pointed out that thanks to the buzz around its Kindle e-reader and cloud computing success, it can be easy to forget that Seattle-based Amazon is an e-tailer at heart. Malik likens Amazon to the online equivalent of super-retailer WalMart now that they have shoes covered.

After reading investor notes from Wall Street Internet Analyst Ben Schachter, Malik was surprised to learn that Amazon accounts for roughly 5% of total video game sales in the United States.

Video Games are an Important Driver for AMZN: We estimate that AMZN currently has ~5% U.S. market share in the category, representing about ~$900mil-$1bn according to our estimate of 2009 U.S. sales (~4% of AMZN’s 2009E total sales and 16%-18% of its estimated 2009 U.S. Media revenue).

Schachter's investor notes got Malik thinking:

Maybe Amazon has become such a behemoth and e-commerce such a mainstream activity that one can safely view the company’s results as a proxy for consumer economic activity in the U.S.

From clothes to shoes to wireless phones to video games and electronics — Amazon sells them all and can accurately track the spending sentiment amongst its buyers. The company does publish some data occasionally, but what would be even cooler was if Amazon published its own “state of the economy” report every month, which would contain data that’s both more current and more accurate than some of what’s collected and published by governmental organizations.

With undoubtedly the best data in the world when it comes to purchasing habits, Amazon is capable of building an advertising platform that could compete with Google.

And it looks like Amazon may be making progress on this front. Maveron Senior Associate Eric Monsowitz recently announced that he is leaving the Seattle Venture Capital firm to join Amazon to help them build out a top-notch online advertising platform and they continue to actively recruit for their Global Online Display Advertising division.

Should Google be worried?

Company:
Google
Website:
http://www.google.com
Location:
Waterloo, Ontario, Canada

Google's mission is to organize the world's information and make it universally accessible and useful. As a first step to fulfilling that mission, Google's founders Larry Page and Sergey Brin developed a new approach to online search that took root in a Stanford University dorm room and quickly spread to information seekers around the globe. Google is now widely recognized as the world's largest search engine --... more

Company:
Amazon
Website:
http://www.amazon.com
Location:
Vancouver, British Columbia, Canada

Amazon.com, Inc. (NASDAQ:AMZN), a Fortune 500 company based in Seattle, opened on the World Wide Web in July 1995 and today offers Earth's Biggest Selection. Amazon.com, Inc., seeks to be Earth's most customer-centric company, where customers can find and discover anything they might want to buy online, and endeavors to offer its customers the lowest possible prices. Amazon.com and other sellers offer millions of... more


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Rob Lewis

Rob Lewis

Rob is the President of Techvibes Media and Editor-in-Chief of Techvibes.com.  His diverse background includes stints in International Trade Finance, Web Development, and Enterprise Software and he is a graduate of the University of British Columbia, British Columbia Institute of Technology, and Simon Fraser University. When not running Canada's leading technology media property, Rob can be... more



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