Amazon ramps up its holiday TV ad spending

December 30, 2016 in TV Advertising

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Internet Retailer - Amazon.com Inc., which has not relied heavily on TV advertising in the past, changed course this holiday season and dramatically increased its TV ad spend, according to a study of eight major retailers by ad sales intelligence firm MediaRadar.

Amazon, No. 1 in the Internet Retailer 2016 Top 500, increased its TV advertising by 76% and its digital ad spend by 224% in October and November over the same months in 2015, MediaRadar says. Both year-over-year increases were the largest among the eight retailers studied.

Amazon Ramps Up Holiday Spending.pngThe leading online retailer spent more than $135 million on TV advertising, placing ads with every major broadcast network and almost every cable channel, a total of 103 outlets, MediaRadar says.

“In the past Amazon achieved their incredible success without much reliance on traditional TV advertising,” MediaRadar says. “But as Amazon goes completely mainstream, their marketing too has cast the widest possible net.” MediaRadar’s estimate is for “linear TV” advertising, that is, for television shows that viewers watch at scheduled times.

MediaRadar says Amazon outspent Wal-Mart Stores Inc., which was second in TV ad spend among the eight retailers, by $16 million and No. 3 Target Corp. by $32 million. Wal-Mart (No. 4 in the Top 500) reduced its TV ad spend by 10% in October and November, according to MediaRadar, while Target (No. 22), increased that spend by 54%.

Wal-Mart was second only to Amazon in its percentage increase in online spending, at 170%. Sears Holdings Corp. (No. 14) and Nordstrom Inc. (No. 18), decreased their spending in all three areas—print, TV and online—MediaRadar says. The one area where Amazon cut its ad spending was in print, which was down 10%.

“Most retailers are reducing print spend while focusing on other channels, like linear TV and digital,” says Todd Krizelman, CEO and co-founder of MediaRadar. “Online ad spend, however, saw some of the biggest increases percentage-wise. This is driven by shifting consumption and shopping patterns among holiday consumers.”

Amazon did not immediately respond to a request for comment.

Macy’s is No. 6 in the Top 500, Kohl’s No. 19 and J.C. Penney No. 37.

 

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