Online retail giant Amazon appears to be on the verge of ambitious expansions into a range of markets, including online grocery retailing, children’s television and advertising.
According to Reuters, sources close to the company are saying the company plans to expand its AmazonFresh online grocery business, currently being trialled in the company’s hometown of Seattle, to Los Angeles as early as this week.
The sources claim the company is looking to expand the service to the San Francisco Bay Area later this year and to as many as 20 markets – including some outside the United States – during 2014.
Speculation about Amazon’s grocery industry plans came as the company signed a record $US200 million deal with US media giant Viacom for exclusive online streaming rights to a range of popular children’s television shows from the cable channel Nickelodeon.
The deal, which covers more than 4000 episodes of programs – including Dora the Explorer, SpongeBob SquarePants and Go Diego Go! – will see the shows appear exclusively through the company’s subscription video download service.
The chief executive of online video rival Netflix, Reed Hastings, points out his service still retains the rights to content from a number of other media giants, including Time Warner’s Cartoon Network and Disney, but acknowledges losing the rights to Nickelodeon content will hurt.
“If you’re a parent and your child’s looking for Blue’s Clues, you know, that is definitely a problem,” Hastings says.
Meanwhile, online marketing analytics firm eMarketer announced in a press release estimating Amazon will sell around $835 million in online advertising after traffic acquisition costs this year, up 36.92% from last year.
In turn, the firm estimates Amazon’s 2012 earnings were up 45.51% from the $419.14 million it earned in 2012, while the company’s ad revenues could top $US1.1 billion in the US alone during 2015.
“Key to further growth will be the plethora of consumer purchasing data Amazon gathers through its core business, retail sales. Ad-selling competitors such as Google and Facebook lack such data – and therefore its targeting potential,” eMarketer says in a statement.
“Amazon has already developed its targeting technology, along with creating its own demand-side platform (DSP) to improve targeting of Amazon buyers on other web properties and devices like Kindles – something that may help position them as a more attractive site for both brand and direct response advertisers.”
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