AI’s Disruption in the Retail Media Space

Changing the Game

When it comes to the ways we search and shop online, AI is making waves. Venture capitalist Joe Marchese thinks this could shake up Amazon’s profitable retail media game. We’re talking billions in revenue at stake here, folks.

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What Went Down

Marchese took to the Risk Reversal podcast to talk shop. The rise of ChatGPT and other AI tools? Yeah, they’re a threat to the retail media landscape. He points to the influence of traditional search and sponsored ads. Companies like Amazon.com Inc. are minting money, expecting a cool $60 billion by 2025, according to WARC Media.

The AI Shift

Picture this: no more searching through pages of ads. You could just ask ChatGPT, “What are the best batteries to get?” and bam, purchase made. Marchese warns, “It’s not just Google’s search; it’s search everywhere.”

Other giants like DoorDash, Uber, Walmart, and Instacart could feel the pinch too. If they’re counting on ad revenue, AI might be the wrench in the works.

Why It Matters

You see, about a month ago, Perplexity AI’s CEO, Aravind Srinivas, called out Google’s search biz as a strategic liability. This means major players need to rethink their strategies in this AI-driven world.

Amazon’s Counterplay

Despite AI’s threat, Amazon’s not sitting still. They’re using the tech to boost value for advertisers, consumers, and investors. CEO Andy Jassy notes that over 50,000 advertisers are leveraging Amazon’s AI to optimize campaigns.

Stock Movement

Amazon shares surged by 1.59% on Thursday, trading at $223.41. However, they dropped by 0.34% after hours. According to Benzinga’s Edge Stock Rankings, Amazon scores well on growth with favorable trends. Get the full scoop here.

Quick Recap

• AI assistants are shaking up search and shopping.
• Marchese highlights the risk to traditional retail media revenue.
• Not just Amazon, but all ad-reliant businesses face challenges.
• Companies are leveraging AI to stay ahead.

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