Amazon.com, Inc. (AMZN)’s Profit Will Skyrocket Once it Starts Monetizing Data

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Amazon.com, Inc. (NASDAQ:AMZN) will soon start selling the data of how consumers buy on its website to advertisers. When it comes to online advertising, Amazon.com, Inc. (NASDAQ:AMZN) is not the name that most people think of as a major player, it’s the social networks and social giants whom people think as the dominant player in the industry. Chad Bartley, Analyst at Pacific Crest Securities disagrees with the crowd, he feels that Amazon.com, Inc. (NASDAQ:AMZN) is much more valuable for online advertisers then other internet companies because the company has vast amount of data on how exactly consumers shop on the internet. Bartley was recently on CNBC to discuss why he thinks that Amazon.com, Inc. (NASDAQ:AMZN) is the leader when it comes to online advertising.

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Bartley revealed that the talks that he had with industry insiders in the past few months, they described Amazon.com, Inc. (NASDAQ:AMZN) as a ‘sleeping giant’, the juggernaut in online advertising industry. He highlighted that Amazon.com, Inc. (NASDAQ:AMZN) not only has data on how consumers shop, but also on what they look for and more importantly what they buy on Amazon.com, Inc. (NASDAQ:AMZN)’s website. He feels that this data is very valuable for advertisers in terms of doing targeted advertising.

“Definitely, a concern with Amazon, when they focus on an industry, they are very aggressive with their investment; they are very aggressive with their pricing. So, we could see some pressure on display advertising over time,” Bartley said.

Bartley believes that entering the advertising space will prove to be a multi-billion dollar opportunity for Amazon.com, Inc. (NASDAQ:AMZN). He mentioned that though the growth in this industry can be lukewarm, it has a very high operating margin. He feels that Amazon.com, Inc. (NASDAQ:AMZN) being Amazon.com, Inc. (NASDAQ:AMZN) might splurge the money it earns through selling data on other ventures, but a major chunk of that money will also trickle down to the shareholders as profit.

As of June 30, 2014, Ken Fisher’s Fisher Asset Management owns over 2.4 million shares in Amazon.com, Inc. (NASDAQ:AMZN).

Disclosure: None
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