Amazon has expanded its growing advertising business to include grocery delivery service AmazonFresh. Packaged food brands have already begun to display ads for consumer packaged goods (CPG) on product detail pages and in search results.
AmazonFresh offers grocery delivery and pick-up to Prime members in select locations. Existing Prime members can add Fresh to their subscription for an additional fee.
In an email to advertisers Thursday, Amazon announced the addition of AmazonFresh ads for consumer packaged goods. Per Business Insider, AmazonFresh ads will only be shown to customers who are eligible to purchase their products. Customization options will be available, such as targeting returning or first-time brand shoppers.
Brands can add their 10-digit Amazon Standard Identification Number (ASIN) to new or sponsored product campaigns. Ads are already being seen across the website from brands like Frito-Lay and Nestle.
The new ads will allow CPG brands another way to stand out in a sea of products offered on Amazon. Nielsen estimates that 20 percent of grocery retail will be conducted online by the year 2025, reaching $100 billion in sales.
In its report, Nielsen warned that engaging grocery shoppers in the digital age will require more than just statistics.
“While analytics will continue to be critical for retailers and manufacturers to understand the digitally engaged food shopper on a deeper level, a collaborative approach to balancing physical and digital sales strategies is the key to unlocking omnichannel success,” said Chris Morley, Nielsen’s US President of FMCG and Retail alongside the company’s findings.
Amazon is the current leader in online grocery sales, representing 18 percent of the market share according to One Click Retail, The site’s grocery revenue soared 35 percent following the acquisition of Whole Foods.
This new ad offering will allow brands to gather insights on the AmazonFresh customer and cater marketing spend accordingly. Likewise, the online retail giant is in a unique position to tap into the growing online grocery business while expanding its sources for ad revenue.
Overall, Amazon’s ad business will capture just 4.1 percent of US digital ad spend last year, according to eMarketer, but that still places it firmly in the number three spot after Google and Facebook. EMarketer predicts that Amazon will capture 52 percent of retail e-commerce sales in 2019.
