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That doesn't sound too dramatic ? it's expected that users of Amazon's Kindle might see ads running on apps they got from Amazon.
But it's only when you understand the full specs of the new network that you realize what a huge potential threat to Google this could be: The ads will also run on any Android device that has downloaded apps from Amazon.
Android, of course, is Google's territory.
Currently, mobile ad revenue is poised to become the heart of Google's entire business. The company changed its ad buying interface to simplify ad buying across desktop and mobile devices. Advertisers expect that change to raise prices for Google ads. And CEO Larry Page has told Wall Street that he expects mobile ad prices to overtake desktop prices in the future. Notably, Google has also upped its game in the online shopping arena, pushing Amazon's search results further down the page.
In short, Google is girding itself for a mobile ad future, not a desktop future.
Amazon
What Amazon's new mobile ads will look like
Now comes Amazon, running ads in mobile apps on Google's Android devices.Here's the potential, per Adweek:
Imagine a women?s shoe brand being able to serve ads for a particular pair of heels only to women who have owned a similar pair, have ?purchased that pair years ago and need to replace them. That?s a possibility if Amazon can recognize app users and match them to their Amazon account. To do that the user would have at least needed to download the app through the Amazon Appstore.
The key here is that currently, Google cannot do anything like that. Amazon may know what shoes you bought in the past, Google does not. Being able to target ads at users with known purchase histories is a goldmine for advertisers.
Right now, Amazon's ad network can't target users that effectively, either. You can see the basic targeting options here, and they're modest (gender, location, and that's about it).?
But as long as Google allows anyone to use its Android phone operating system for free, there's not much it can do about Amazon stealing its eyeballs.
What Amazon doesn't know, however, is what users want to buy right now when they're not on Amazon. That information belongs largely to Google (when you search for Louboutins on Google, it's a pretty good indicator that you're in the market for a pair).
As we've noted before, the universe of information that advertisers need to target their ads is spread largely across three giants:
Amazon: Owns the best database of actual shopping history and purchases. This type of data is like gold for advertisers. Clients have long awaited the day when "the sleeping giant," as it is known in the ad biz, finally wakes up to advertisers. It also knows a lot about its consumers' identities, including addresses and credit card numbers.
Facebook: Owns the best database of personal information about consumers. 1 billion users strong, with all their interests and friends, it's terrifically useful stuff for marketers. But it doesn't know their purchase histories, or their future purchase desires.
Google: Has traditionally dominated the "purchase intent" sector of the category. When people search for "Star Wars DVD" online, that's a pretty good indicator they want to buy said movie. Google has been serving ads (and retargeting ads) against such requests for years. But its data on shoppers and their histories has never been as good as Amazon's or Facebook's.
In this scheme, Amazon appears to regard Google as the easiest competitor to attack. Google knows the least about its consumers (except when they want something right now). And while Facebook's user data is interesting, it's not the kind of e-commerce platform that threatens Amazon. Yet.
That's why?Amazon is now leveraging Google's assets against itself.
It's dealing with the biggest threat first.
Source: http://www.businessinsider.com/amazons-new-mobile-ad-network-is-a-huge-threat-to-google-2013-3
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