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Amazon Pitch
Amazon is reviewing its global media agency account, with a significant advertising budget exceeding $5 billion in 2016. The company, a major e-commerce player, competes with various firms while also growing its services, such as Whole Foods acquisition and enhancing its online marketplace. Insights into consumer behavior and shopping trends indicate a shift towards mobile and online purchasing, particularly in the grocery segment.
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Introduction to Amazon's global media account review. 2016 ad spending was over $5 billion; major competitors outlined.
E-commerce growth highlighted, forecasting $4.1 trillion in global sales by 2020 with significant shares from Asia-Pacific and other regions.
Online shopper statistics, mobile vs. desktop usage, transaction averages, with $322.2 billion in U.S. sales in 2016.
Leading e-retailers statistics with Amazon's $136 billion net sales and segment breakdown of revenue indicating strong growth in web services.
Customer purchase frequencies and reasons for Amazon usage. Marketing tools, including social shopping features like Spark, are discussed.
Amazon's significant marketing budget and the profile of digital grocery shoppers, focusing on demographics and shopping behavior.
Insights into the health and savings-minded digital grocery shopper, emphasizing dietary habits and price sensitivity.
Invitation to explore Amazon's consumer insights tools for targeted marketing analysis.
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Amazon Pitch
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- 2. NAME BRAND PITCHTYPE Media MARKET DATE The Data You Need to Win This Pitch DESCRIPTION E-commerce giant Amazon is conducting a global media agency review. It’s a huge piece of business. The firm spent more than $5 billion on advertising and promotional costs in 2016, according to the firm’s latest annual report. Of that total, more than $1 billion is estimated to be earmarked for measured media expenditures worldwide, most of it targeted to U.S. consumers. It’s believed that most of the holding companies will participate in the review, although one exception is Omnicom, which handles competitor Google. Amazon puts Its Media Account In Review North America August 8, 2017
- 3. Client Profile /Market Amazon.com, Inc. is an online retailer that offers an ever expanding range of products, including books, music, videotapes, computers, electronics, home and garden, and numerous others. Amazon offers personalized shopping services, web-based credit card payments, and direct shipping to customers. COMPANY BACKGROUND MAIN COMPETITORS 2016 Sales (mil) 2016 Employees Employee Growth Percent Assets (mil) Net Income Growth Percent Sales Growth Percent 136,000 341,400 - - - - FINANCIAL OVERVIEW - Source: AccessConfidential.com - DECISION MAKERS by [email protected] Vice President, Marketing and Strategy Mr. Chris Baker [email protected] Marketing Manager Ms. Katie Dunwell
- 4. E-commerce Worldwide Purchased GoodsOnline 1.6 billion$1.9 trillion Global e-retail sales $4.1 trillion Global e-retail sales by 2020
- 5. Fast Food industryin numbersE-commerce Worldwide Of total retail sales Asia - Pacific 12.1% Of total retail sales Middle East - Africa 1.8% E-commerce share of total global retail sales from 2015 to 2021 (Thousands of Units) 2015 2016 2017* 2018* 2019* 2020* 2021* 6% 8% 10% 12% 14% 16% 7.4% 8.7% 10.1% 11.6% 13.1%13.1% 14.6% 15.5% SHAREOFE-RETAILSALES
- 6. Fast Food industryin numbersOnline shopping penetration rate 76% 72% 72% 68% 67% Average number of transactions per Online Shopper Asia 22.1 North America 19
- 7. Fast Food industryin numbersMost popular shopping categories worldwide 58% of Internet users have purchased fashion-related products through the internet November 2016 55% of Internet users have purchased travel-related products & services through the internet November 2016
- 8. Fast Food industryin numbersMobile Shopping vs Desktop Shopping Online Retail Traffic Share 48% DESKTOP 52% SMARTPHONE Online Retail Order Share 70% DESKTOP 30% SMARTPHONE Average Value of Online Shopping Orders $143.35 $114.5 $109.7MOBILE BROWSER ORDER SHARE 54% MOBILE APPS ORDER SHARE 46%
- 9. Fast Food industryin numbersU.S. E-Commerce Market $322.2 bn 2016 E-Commerce sales $485.3 bn 2020 E-Commerce sales Forecast E-commerce share of total retail sales 8.1% CYBER MONDAY Is the top online spending day in the US $2.7 billion Spent in 2016
- 10. Fast Food industryin numbersU.S. E-Commerce Market TRADITIONAL SMARTPHONE TABLET OTHER 150 125 100 75 50 25 0 ORDERVALUEINU.S.DOLLARS Average value of online shopping orders in the U.S. as of 1st quarter 2017, by device (in U.S. Dollars) Books Automotive Prefer to purchase in-store Prefer to purchase digital 38% 62% 88% 12% PRODUCT CATEGORY MOST SHOPPED ONLINE PRODUCT CATEGORY LESS SHOPPED ONLINE 20% US consumers purchase goods online on a weekly basis
- 11. Fast Food industryin numbersU.S. E-Commerce Market LEADING WEB-ONLY MERCHANT LEADING RETAIL CHAIN (RANKED BY E-COMMERCE SALES) FASTESTS-GROWING E-RETAILER Lord & Taylor
- 12. Fast Food industryin numbersAmazon $136 b NET SALES 27% Y-O-Y REVENUE GROWTH 341,400 EMPLOYEES
- 13. Business Segments NORTH AMERICA $79,785 M 59% + 25% INTERNATIONAL $ 43,983 M 32% + 24% WEB SERVICES $ 12,219 M 9% + 55% NET SALES Sales Share Y-o-Y Growth
- 14. Fast Food industryin numbersNet Revenues by Segment 2.2% OTHER 9.0% AWS 16.9% RETAIL THIRD-PARTY SELLERS 67.2% RETAIL PRODUCTS 4.7% RETAIL SUBSCRIPTION R E V E N U E B Y S E G M E N T S
- 15. Customers Frequency with whichUS Amazon buyers make a purchase via Amazon Nov 2016 ( % of respondents ) One a week or more 2-3 times a month Once a month 3-4 times a year Once a year 20% 36% 24% 19% 1% Note: n=1,000 ages 18+ Source: Radial, Attitudes Among Amazon Shoppers Conducted by Finn Partners, Dec 14 2016 REASON WHY 38% Product Selection 29% Product Prices 18-29 Years Old Prioritize Speed of Delivery ( 29% of total ) 54%Amazon Shoppers purchased electronics in the last year 59%US Internet Users Use Amazon at least occasionally 63% Amazon’s shopping users are Prime Members
- 16. Fast Food industryin numbersThe Whole Foods Acquisition Amazon acquired Whole Foods Market for $13.7 bn in 2017 BOOSTING PRIME MEMBERSHIPS Amazon has introduced Prime as a Customer Loyalty Program Amazon Lockers will be installed in some Whole Foods stores Amazon.com, Amazon Fresh, Prime Pantry and Prime Now Are selling Whole Foods Private labels Amazon announced it would instantly lower the prices for a series of products at Whole Foods by up to 50% Store traffic at Whole Foods stores increased by 25% Amazon added 2,000 Whole Foods 365 Everyday products on its own web shop Web sales of Whole Foods branded products totaled about $500,000 in the first week QUICK RESULTS
- 17. Fast Food industryin numbersAmazon’s Spark SPARK IS US & iPHONE ONLY An Instagram-like social shopping feed aimed at improving product discovery. Spark users are encouraged to post stories, ideas and images of products they love, which others can react to. To post, you have to belong to Prime and have spent $50 on Amazon. FIVE WAYS OF BOOSTING BUSINESS Facilitate Product Discovery Drive social engagement that revolves around social commerce Posts from Influencers and publishers like Apartment Therapy Spark supports video, harnessing the popularity of “un-boxing” and tutorial videos on YouTube Promote Prime memberships Data collection & timed ads
- 18. Amazon’s Marketing Spending $139.3 bn Amazon Brand Value $ 2.6 bn Amazon US Advertising spending $ 5 bn Amazon Global Advertising spending Amazon 3% 91% PERCENTAGE OF MARKETING BUDGET SPENT ON ONLINE ADVERTISING DIGITAL SEARCH
- 19. Fast Food industryin numbersAmazon’s Audience SEE THE FULL PROFILE FEMALES 60 % 55-69 YEARS OLD 26 % TOP PSYCHOGRAPHICS 37.4% Living in the South Region FOOD LOVERS MONEY SAVERS BEAUTY & WELLNESS AWARE
- 20. QUICK DEFINITION: Digital GroceryShoppers Digital Grocery Shoppers are consumers who make use of online website/apps to buy groceries. Our target is based on consumers interested in online groceries like Peapod and FreshDirect 10% 20% 0 30% 15-17 18-24 25-34 35-44 45-54 55-69 77% FEMALE 58% MARRIED 47% WITH CHILDREN 2.6 x MONEY SAVERS 2.4 x DIGITAL GROCERY SHOPPERS • • • ••• BEAUTY & WELLNESS AWARE HEALTH CONSCIOUS 2.3x 2.0 x ART APPRECIATORS
- 21. DIGITAL GROCERY SHOPPERS: BEAUTY/WELLNESS GETFULL INSIGHTS THOUGHTFUL EATERS Digital Grocery Shoppers are responsible about their diet. Food for them is a source of nutrition as well as enjoyment. They are not on any particular diet, rather do their best to eat a healthy, balanced lineup of meals. They try to eat breakfast every day, regularly eat organic foods, and rarely eat fast food. ACTIVE & FIT 1.6x Their body image is important to them and they often incorporate vitamins and supplements to be sure they are getting the most out of their workouts. 4.2x UP4 PROBIOTICS POPULAR VITAMIN BRAND
- 22. DIGITAL GROCERY SHOPPERS: HEALTH Interestin Health & Fitness Apps grew by 35.8% over the last quarter BABY CARE 2.3x Free of harsh chemicals and toxins, BabyGanics' products are plant-based, natural and contain no fillers or dyes. POPULAR BABY CARE BRAND QUARTERLY TREND +35.8% GET FULL PROFILE
- 23. DIGITAL GROCERY SHOPPERS: SAVINGS GETTHE FULL PROFILE MONEY SAVERS 2.4x People in this segment tend to save money in several branches of shopping like clothing, department stores, electronic stores. They generally consider price first amongst other factors and are always up to date with the latest offers by searching for them on the web. TRENDING DAILY DEAL WEBSITE QUARTERLY TREND +114.7% Coupon users are spending 24% more than regular shoppers
- 24. DIGITAL GROCERY SHOPPERS: ART GETTHE FULL DASHBOARD PAT PERRY 4.5x POPULAR ARTIST QUARTERLY TRENDING ARTIST KAREN HALLION +148.2%
- 25. CONSUMER INSIGHTS SUITE Discover Amazon’sTarget Consumer TRY NOW FOR FREE > on Cubeyou Consumer Insights Suite