Amazon’s 2023 Ad Revenue Forecast to Reach $43bn, Edging the Entire Global Publishing Ad Market

WARC Media has forecast that Amazon’s ad revenue will reach $43bn this year, edging ever-closer to the entire global publishing ad market, which is forecast to be worth $47bn.
The company earned nearly $38bn from advertising services in 2022.However, the latest Global Ad Trends report ‘Media model in flux’ revealed that as the global publishing ad market continues to shrink, print still accounted for 72.9% of total ad spend in publishing. It’s becoming increasingly challenging for a publishing business to survive on advertising revenue alone. A study by The Reuters Institute publishers now rely on an average of three to four primary revenue streams.
Conversely, enabled by the rapid rise of retail media networks worldwide, ad spend has started shifting to platforms without content but situated at the bottom of the funnel. According to a GroupM and WARC Media analysis, retail media will account for over a fifth (20.8%) of online ad investment in 2023 and is forecasted to be worth up to $168.3bn by 2027.
Amazon, viewed as the standard-setter of e-commerce and the ‘most desirable’ online retailer, has become the key beneficiary/driver of the retail media boom, despite facing increasing challenges from peers like Walmart, Target, and new entrants who bet on their first-party data such as Uber,
When compared with tech platforms, Amazon’s ad revenue continued to outpace its digital advertising peers amid a slackening ad market. In Q4 2022, while Alphabet and Meta reported falling Q4 ad revenues, Amazon saw its ad revenue grow 19%, reaching $11.6bn.
Moreover, as the video market – especially for subscription video-on-demand (SVOD) companies – gradually shifts to ad-tiers in pursuit of profitability, Amazon Prime video is forecast to attract 60 million users by 2027 in Western Europe alone. Its ad-supported streaming ambition received much attention as advertisers were able to create a close-loop purchase environment through video ads.
However, Amazon’s consecutive rounds of layoffs and a $10bn revenue loss from its star product Alexa indicate the inevitable slowdown the macroeconomic climate brings. On 20 March, it announced the plan to lay off 9,000 more employees from various departments including advertising and Twitch, because “user and revenue growth has not kept pace with our expectations”, said Twitch CEO Dan Clancy.