RetailTechNews’ weekly Amazon Watch brings you some of the company’s biggest moves from the past seven days, analysing how the giant is revolutionising the retail space. In this week’s edition: Amazon Taking More of Retailers’ Budgets; Walmart vs Amazon in India; and Amazon Could Lead U.S. Apparel Retail by the End of This Year.

Amazon Taking More of Retailers’ Budgets

Retail brands will invest 55% more in online marketing and advertising by 2023, but fewer dollars will go toward traditional search channels, like Google, according to a new Forrester report.

Instead, Amazon will continue to erode Google’s market share. The move signifies a shift in the way consumer shopping habits continue to change, with more consumers heading towards Amazon and retail websites for shopping and towards Google and Bing for answers to questions.

The shift gives Amazon a reason to strengthen its search features – text and voice – for organic traffic, as well as its search advertising platform. While Amazon increasingly competes with search engines for shoppers, voice search creates new ways to reach buyers, and mobile continues to play a “significant” role in influencing sales.  

Publicis, Omnicom, and WPP plan to boost their ad spend with Amazon between 40% and 100% in 2018, according to Forrester, citing online reports.

Estimates put about one-third of today's U.S. online retail spend with Amazon, giving the marketplace an edge on e-commerce searches in Google. Many of those searches are on mobile devices. In fact, mobile accounts for 56% share of total digital ad spend and influences 32%, or USD$1.1tn (£789bn), of total retail sales in the U.S.

Consumers are not only typing what they want into a search box – more often they speak their request. The adoption of voice interaction with devices will grow, albeit slowly, from 21 million in 2017 to 166 million in 2022.

Walmart vs Amazon in India

Amazon expects groceries and household products to account for over half of its business in India in the next five years, as it moves to broaden offerings in the segment and foray into areas such as fresh produce.

AmazonFresh, which launched more than a decade ago in the U.S. market, is the company’s flagship fresh grocery delivery service. In India, Amazon currently offers some groceries via a service named 'Pantry'. It has also tied up with local vendors in four cities for Amazon Now, which promises two-hour deliveries.

India’s e-commerce market is tipped to grow to USD$200bn (£143bn) in a decade, according to Morgan Stanley, as cheap mobile data makes online shopping increasingly accessible. What’s more, Amazon, which already has over 100 million registered users in India, is looking to cash-in on the opportunity.

The news comes as Walmart is close to finalising a deal to buy a majority stake in Flipkart, India’s leading e-commerce company, for at least USD$12bn (£8.6bn). Combined with Amazon’s expansion, it looks as though India is going to be the newest battleground for these two behemoths. With Amazon’s failings in China still fresh in their memory, Jeff Bezos’ business is keen to press their position in India. However, with Walmart’s backing, it seems unlikely that they will manage to overthrow Flipkart as the leading e-commerce company in the near future.

Amazon Could Lead U.S. Apparel Retail by the End of This Year.

Amazon is expected to be the leading U.S. apparel retailer in 2018, according to a report from Morgan Stanley cited by CNBC. It had 7.9% in market share in U.S. apparel retail sales in 2017, coming in second to Walmart’s 8.6%. Both retailers are far ahead of the rest of the field, with third place Target holding only 4.8% market share.

Apparel brands are deepening their relationships with Amazon, bolstering its prestige and product selection. Nike started selling directly through Amazon for the first time this year, while Calvin Klein began selling new products exclusively on the site. These brands, among others, appear to be looking to Amazon to improve their direct-to-consumer performances, especially as traditional brick-and-mortar retailers struggle. As those issues continue, more brands may strike similar deals with Amazon, driving its market share higher.

Building out its product selection with new brands should help Amazon’s apparel business take off, as its reputation for having everything has helped it succeed in other segments. The second most popular reason consumers start their product searches on Amazon is because it's most likely to have the products they want, according to Business Insider Intelligence’s Amazon Commerce Competitive Edge 2018 survey. However, the e-commerce titan’s apparel offerings previously couldn't live up to the same expectations. With more brands coming to its marketplace, and potentially new exclusive offerings, Amazon may be able to build up the same reputation in apparel.This content was originally published in RetailTechNews.