Amazon’s Strategic Move in Digital Advertising Landscape Amazon’s Strategic Move in Digital Advertising Landscape

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By Ronald Tech

Amazon.Com, Inc AMZN has struck a partnership with Reach, the UK’s leading publisher, to utilize customer data for refining online ad targeting.

This move is a response to Alphabet Inc GOOG GOOGL Google’s decision to phase out third-party cookies, a crucial tool for tracking user behavior to tailor advertisements.

The removal of cookies by Google is poised to bring substantial changes to online user tracking, impacting the $600 billion online advertising industry.

As Google initiates the removal of cookies from Chrome, a strategy also echoed by Apple Inc AAPL for Safari, the focus is shifting towards leveraging first-party, contextual data, according to a report by the Financial Times.

Through this alliance, Amazon seeks to enhance ad targeting on Reach’s platforms by aligning ads with the content consumed by users, thereby bypassing the reliance on third-party cookies.

This strategic collaboration signifies a key adaptation within digital advertising, emphasizing the use of contextual signals to place ads, reflecting a broader industry trend towards prioritizing user privacy and data protection.

The initiative underscores the evolving nature of digital advertising, with a clear shift towards first-party data and contextual advertising as viable alternatives to traditional cookie-based methods.

The significance of this shift has not gone unnoticed by industry experts. Jon Steinberg, CEO of Future, a competing FTSE 250 publisher, highlighted the profound impact of the disappearance of third-party cookies on the advertising market.

Steinberg pointed out the growing reliance on publishers known for high-quality editorial content, extensive Reach, and rich first-party data.

He envisioned a closer collaboration between advertisers, agencies, and premier publishers to target audiences that drive brand outcomes effectively.

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Echoing this sentiment, Sir Martin Sorrell, CEO of advertising giant S4 Capital, mentioned the rising concern among clients lacking first-party customer data, indicating a heightened focus on acquiring consented data through website sign-ups, according to FT.

This strategy aims to enrich companies’ data reserves, ensuring they remain competitive in targeting and reaching their desired audiences effectively.

Price Action: AMZN shares are trading lower by 0.71% at $169.10 premarket on the last check Tuesday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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