Last week, Code3 Amazon Strategists had a front-row seat (literally!) to the marketplace’s flagship advertising conference, Amazon unBoxed. The event was a chance to look back at how far Amazon and their ad business has come, but also to look towards the future, with the announcement of many new offerings and opportunities for brands.
Amazon’s recent earnings report showcased a 26% increase in Q3 for their ad business, making it one of the company’s fastest-growing sectors. However, Amazon’s ad revenue still leaves them trailing behind Google and Meta, and CEO Andy Jassy recently told analysts during a call the company has “barely scratched the surface” of its advertising opportunities. Amazon is entering 2024 full steam ahead, with plenty of chances for brands to expand their reach and capabilities for advertisers to measure appropriately.
Amazon’s Entertainment Offering: Sponsored Ads Streaming TV and More
It’s no secret that Amazon has put in the work to build up their entertainment offering, from OTT services to live sports and much more, and the company emphasized the progress during unBoxed. They also announced an ad-supported tier will be coming to Prime Video - which has historically been ad-free - in Q1 of 2024. This is a big draw for advertisers, opening them up to 167 million US Prime Video subscribers.
However, the continued investment in entertainment and binge-worthy content will also benefit the machine learning models that power their audiences. Long term, this translates into more refined entertainment-based audiences and richer, more comprehensive audience modeling, a similar trend brands saw in 2020. Months after shopping habits shifted online due to lockdowns, the available audiences within DSP increased in granularity and refinement, while also maintaining previous levels of reach and scale. As Amazon continues to grow and diversify their content offering, we expect similar advancements, making DSP audiences even stronger.
Another important announcement was Sponsored Ads Streaming TV, a new service starting to become available for brands. This new service is an important opportunity for brands not yet leveraging streaming/OTT initiatives through DSP, or those who don’t have the budget to meet minimums to do so. Sponsored Ads Streaming TV is now being offered through the search console, meaning there are no budget minimums.
“With the introduction of Sponsored Ads Streaming TV, It’s easier than ever for brands to begin to invest in streaming, “ said Greg Wolny, Code3 Chief Activation Officer. “This new offering is an exciting entry for brands to begin to test DSP-type initiatives, and is a great new addition to 2024 advertising strategies.”
While not all brands should jump on this new offering, especially those already utilizing streaming/OTT initiatives, it’s an exciting opportunity for others. This high funnel opportunity allows brands to increase brand awareness, which will in turn positively impact branded searches and search overall. For brands with lower budgets, it’s a no-brainer to reach new customers through video, resulting in consumers coming back to search for themselves.
And finally, Amazon Publisher Cloud (APC) was announced. The brand new tool offers advertisers programmatic deals that drive greater campaign reach and relevancy among high-intent audiences. It’s powered by publisher first-party insights from NBCU, DirecTV, TelevisaUnivision, Dotdash Meredith and Fandom to begin, with more publishers being onboarded.
APC allows advertisers to activate high-intent audiences at scale, via exclusive signal collaboration between the above leading publishers and Amazon Ads. “Initially, APC has potential to drive efficient audience reach without relying on traditional methods and identifiers. It’s an important new tool brands should leverage, and could be critical longer term,” said Ben LeMaster, Director, Programmatic. “As with any new offering, Code3 Strategists are excited to see where APC fits into our clients strategies and how it can be leveraged long term.”
New Ad Tech Capabilities
For many advertisers, measurement remains a problem with no real solution, but Amazon announced several new ad tech capabilities to bridge the gap in the future. These include:
- Cross-Channel Planner - A tool that can streamline the media planning process by providing forecasted relevant reach and estimates performance throughout the funnel.
- AMC Custom Audiences - Exclusive to DSP, Custom Audiences offer advertisers more controlled targeting, allowing them to activate and optimize in a meaningful way
- Amazon Marketing Stream - This tool has expanded to include DSP, enabling greater real-time optimization opportunities across a brands entire Amazon Ads strategy.
- Expanded New-to-Brand Metrics, Amazon DSP Events Manager and AMC Template Analytics - All of these tools are now available to help brands measure the impact of their marketing efforts throughout the customer journey with faster, more actionable insights.
As brands and advertisers begin to plan for 2024, it’s critical to be leveraging and testing the latest technologies and features from marketplaces. Some new tools have begun rolling out already, with more to come soon. If your brand isn’t already thinking of how to leverage them, you’re already behind.
