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In This Week's News, we welcome new perspectives as Fox focuses on ad-supported rather than SVOD platforms, and Amazon presenting a 66% Growth in annual advertising revenue, in addition to Smart Communications’ new research report, revealing opportunities for businesses to continue to evolve and ultimately achieve a greater competitive edge.

This Week's News: 2021/03/17

Mara Heathcote

Key Changes to Amazon that Will Shape 2021 Brand Strategy

  • 38% Growth in annual net sales & 66% Growth in annual advertising revenue
  • All but the largest brands will be expected to sell on Amazon as their own seller or through third-party sellers.
  • Amazon’s international net sales grew to $104 billion in 2020, up from $75 billion in 2019. 
  • Founder and CEO Jeff Bezos stated that he will step down from his role to become the Executive Chair in Q3 2021.

As the e-commerce titan grows, having a brand presence on Amazon is becoming less of an option and more of a necessity for brands who want to remain competitive. Amazon was a major winner in terms of e-commerce growth, reporting annual net sales of $386.1 billion in 2020. Amazon’s annual net sales grew 38% year-on-year, a massive figure for a company of Amazon’s size. Amazon’s fulfillment issues in late spring and early summer allowed competitors to secure a stronger foothold in the space as Amazon’s market share diminished from 44% in 2019 to 31% in 2020. Recent changes in senior leadership suggest that Amazon will shift its focus to expanding and improving its platform instead of growing its direct retail relationships with brands. Expanding its platform would increase its value proposition for third-party sellers and advertisers operating on its marketplace, which generated $300 billion of Amazon’s $490 billion GMV in 2020, according to Marketplace Pulse.

Tubi Recruiting Advertisers As It Preps Original Programming Launch

  • Tubi plans to develop original programming and is in talks with potential advertisers for its first offerings.
  • Fox will focus on ad-supported rather than SVOD platforms

Tubi has seen rapid growth, reporting 33 million users as of September 2020. Fox has called Tubi its "growth machine," projecting that the AVOD will yield $300 million in ad revenue this fiscal year. Fox believes it can win in the advertising video-on-demand world although other competitive streamers, such as Pluto TV, has also begun exploring original programming. Roku has acquired rights to original programming from the defunct Quibi streaming app, and has been hiring programming executives.

Smart Communications Study Reveals Accelerated Need to Shift to Digital Conversations in APAC due to COVID-19

  • Smart Communications sought to gain a better understanding of how new challenges and changing expectations are accelerating digital transformation in the APAC region.

While many businesses prioritized digital efforts aimed at delivering personalized, omnichannel customer conversations, Smart Communications, a technology company helping businesses engage in meaningful customer conversations, shared key findings from their new research report, Smart Communications Study: Customer Conversations in APAC, which identified several areas in which customer expectations are still not being met and revealed opportunities for businesses to continue to evolve and ultimately achieve a post-pandemic competitive edge. Key points include:

  1. Approximately three-quarters of consumers prefer digital channels, with one-third making the shift as a result of the pandemic, meaning 3x as many consumers are interested in digital communications compared to direct mail.
  2. Whilst over half (53%) of businesses rate the communications they send to customers as “excellent” or “very good”, only around a third (36%) of customers share this view.
  3. Consumers ranked mobile-friendly forms that offer the flexibility to start and stop without losing information, and that are pre-populated with known details, as key to an effective interaction.

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