Amazon.com , the world's largest online retailer, announced on Monday that it will let American users of Snapchat purchase certain goods straight from the app. The move is an attempt to take advantage of the rising trend of social media buying.
On the news, the social media company's stock increased by over 9%.
Due to social networks' growing influence over consumer trends and behaviours, certain platforms, like TikTok, are introducing their own online buying experiences, while other platforms, like Snapchat, are letting e-commerce companies leverage their user base.
Amazon has similar partnerships with Pinterest and Meta Platforms, the company that owns Facebook. With better-than-expected profits last month, Snap's advertising revenue may see a resurgence with the help of this alliance.
According to Insider Intelligence chief analyst Jasmine Enberg, "the battle with TikTok is on, and the partnership will help Amazon compete in the more impulse-driven, serendipitous type of shopping that happens on social media."
Enberg continued by saying that Snap may be able to establish itself as a popular shopping spot with this move, something it has previously struggled to do.
Customers will be able to shop straight from Snapchat advertising for Amazon and complete their purchase without ever leaving the app thanks to the partnership, the Seattle-based company announced via email.
It further stated that on certain Amazon product advertising in Snapchat, prospective customers would also be able to view real-time pricing, Prime eligibility, delivery estimates, and product details.
The Information broke the story first, and when asked Snapchat declined to comment on this news.
How does Amazon Makes money
Amazon generates revenue through a diverse range of business segments. Keep in mind that business models and revenue streams can evolve, so it's advisable to check the latest financial reports or news for the most current information.Here are some primary ways Amazon makes money:
E-commerce Retail:
Amazon started as an online bookstore but has expanded into a vast online marketplace selling a wide variety of products, including electronics, clothing, books, and more. The company earns revenue by taking a percentage of each sale made on its platform.
Amazon Web Services (AWS):
AWS is a cloud computing platform that provides a variety of services, such as computing power, storage, and databases, to businesses and individuals. AWS is a significant contributor to Amazon's revenue and profits.
Third-Party Seller Services:
In addition to selling its own products, Amazon allows third-party sellers to use its platform to reach a broader customer base. Amazon charges fees for services like fulfillment, storage, and referral fees for these third-party sales.
Subscription Services:
Amazon offers subscription services like Amazon Prime, which provides members with benefits such as free shipping, access to streaming services like Prime Video, and exclusive deals. Prime membership fees contribute to Amazon's subscription revenue.
Digital Content and Services:
Amazon sells digital content, including e-books, music, movies, and TV shows through services like Kindle, Amazon Music, and Prime Video.
Physical Stores:
Amazon owns and operates physical retail stores, including Amazon Go, Amazon Books, and Whole Foods Market. These brick-and-mortar stores contribute to the overall revenue.
Advertising Services:
Amazon has a growing advertising business. It earns revenue by offering advertising services to sellers and vendors on its platform, allowing them to promote their products through various advertising formats.
Amazon Fresh and Pantry:
Amazon has ventured into grocery and food delivery services, such as Amazon Fresh and Amazon Pantry, generating revenue from the sale of groceries and household items.
Amazon's business model is characterized by its focus on customer experience, technological innovation, and diversification across multiple industries. Keep in mind that the specific revenue contributions from each segment can change over time as Amazon continues to evolve and expand its business.
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