How Brands Should Plan for Amazon Prime Video Ads
Advertisements have officially launched on Amazon Prime. Amazon first announced this new video ad tier in November, which will automatically default for all accounts. While users who prefer an ad-free experience can pay an additional $2.99/month to avoid these ads, this platform expansion will allow advertisers to engage with viewers on a massive scale across desktop, mobile, and connected TV environments.
Massive Audience Reach
At launch, Prime Video ads are projected to reach an estimated 115 million monthly viewers in the U.S. This extensive audience means brands can connect with consumers where they are and offer a frictionless shopping experience. According to Amazon Advertising, Prime Video households spend 22% more monthly in the Amazon store than non-Prime Video households, making it a strategic space for brand influence. And since the Amazon Video platform spans multiple devices, advertisers can expect to connect with consumers across demographics and lifestyle preferences.
Powerful Tools for Campaign Building
Amazon Prime Video's advertising platform allows brands to target specific demographics and lifestyle audiences. Prime Video ads will leverage Amazon's first-party signals and exclusive tools tailored to the most relevant and engaged audiences.
Amazon Ads suite of ad tech tools can be used to enhance the planning, activation, and measurement stages of Prime Video campaigns. According to Amazon Advertising, campaigns utilizing first-party lifestyle audiences on the platform experienced a 10% lift in the detail-page-view rate and a 6% lift in the add-to-cart rate compared to campaigns targeting standard demographic audiences.
Planning for Amazon Video Ad Tier
According to Business Insider, Amazon Prime Video CPMs will be priced lower than competitor streaming platforms - reportedly around the low to mid-$30 range.
Amazon's introduction of a new paid ads tier for Prime Video presents an intriguing opportunity for brands, particularly in a landscape where ad-supported streaming is becoming the norm. Most platforms, with the exception of Apple TV Plus, have integrated commercials, and consumers are gradually readjusting to ad content. It will be interesting to see how consumers react with their wallets, as the Reddit forums are full of people threatening to leave.
This shift offers brands a chance to capitalize on Amazon's extensive user data and the offer of targeted and effective advertising at a competitive cost-per-thousand impressions (CPM) in the mid $30s range. Although Amazon plans to limit ad inventory compared to traditional linear or other streaming services, this scarcity could drive competition and value for early adopters.
For brands considering this new advertising avenue, it's crucial to approach it strategically, ensuring it aligns with broader marketing goals and complements existing efforts on Amazon's vast platform. This integration could significantly enhance a brand's ability to connect with customers throughout their buying journey.
It's important to deliberate on a few key points:
- Since the first dollar of Amazon ad spend should always go to sponsored products, brands need to consider the effectiveness and scale of those current campaigns.
- Then, review the success of previous video campaigns on the platform and strategies for re-engaging customers.
- Finally, always ensure your product listings are best in class before diving into any shiny new ad spend opportunity.
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