RetailTechNews’ weekly Amazon Watch brings you some of the company’s biggest moves from the past seven days, analysing how the giant is revolutionising the retail space. In this week’s edition: Amazon could be rolling out banking for younger customers; Ad growth to break the duopoly; Amazon’s expansion in Brazil.
Amazon could be rolling out banking for younger customers
Amazon is looking to expand its services to banking, by offering a current account to its customers. The offering will be aimed at young people and other consumers who do not currently have their own account. However, according to a report in the Wall Street Journal, the project is still at an early stage.
It looks like the expansion of a financial offering is less about disrupting the financial sector and more about increasing engagement on the Amazon marketplace. As the service would be targeted at younger audiences, who don’t have their own bank accounts, it would engender loyalty in this age group, allowing them to begin shopping online.
Similar moves have proven successful for other online giants overseas, such as Alibaba and Rakuten. It would also allow Amazon to reduce card processing fees, and provide another channel for winning new customers.
Ad growth to break the duopoly
Amazon could have a big future in advertising, especially during the holidays, according to a Forrester report. The report shows that one search marketing agency said its clients already spend about 45% of their yearly Amazon ad budget during the holiday season.
The huge selling point for marketers using Amazon is the company’s purchase data, which according to Forrester puts it a notch above Facebook and Google, which themselves account for almost 60% of online advertising. In years to come, Forrester expects marketers to increasingly turn to the Amazon Advertising Platform, which 44% of ad buyers already use.
These findings shouldn’t come as too much of a surprise. With brands still investing large proportions of their advertising budgets on in-store marketing, a form of advertising that is very hard to track in terms of ROI, there is demand for a new form of advertising. The reach and data available on the Amazon platform makes it a prime contender to fill this spot, as customers prioritise speed and convenience during the holidays.
Amazon’s expansion in Brazil
Amazon met with an array of manufacturers in Brazil last week, to discuss plans to stock and sell products from consumer electronics to perfume in the country. The move would take the U.S. e-commerce giant beyond its current role in Brazil as a marketplace for third-party sellers, representing a major advance into the biggest retail market in Latin America.
Amazon has waded slowly into Brazil’s complex and highly competitive online retail market, starting with e-book sales in 2012, adding physical books two years later, and offering third-party sales of electronics in October.
Yet the company appears to be accelerating its expansion this year, as the Brazilian economy exits a painful recession, stiffening competition for local rivals such as Mercado Libre and B2w Cia Digital.
E-commerce accounts for around 5% of Brazil’s roughly USD$300bn (£216bn) retail market – about half its share in the United States – but has doubled in the past four years and is forecast to keep growing annually at a double-digit pace.
This content was originally published in RetailTechNews.