How to Leverage the Newest Amazon Prime Video Ad Formats

UPDATED: May 9, 2024

Just four months after introducing ads on its Prime Video streaming service, Amazon is unveiling additional promotional tactics, including displaying ads when viewers pause content. Announced a few days before Amazon's 2024 upfront debut, Prime Video will feature three new ad formats to encourage subscribers to purchase promoted products. 

Amazon released these details on the three types of new shoppable and interactive formats available to advertisers:

1. Shoppable carousel ads: Brands can present a sliding lineup of products during ad breaks on Prime Video, allowing customers to browse and add items to their Amazon cart using most living-room remotes. The ad automatically pauses for browsing and resumes when interaction stops.
2. Interactive pause ads: When viewers pause a show or movie, a translucent ad appears featuring brand imagery and an "Add to Cart" option. These ads allow customers to easily add products to their cart, request more info via email, and resume streaming at any time.
3. Interactive brand trivia ads:  Advertisers can entertain customers with brand factoids while offering the opportunity to shop, learn more, and unlock rewards like Amazon shopping credits. Customers can add products to their cart, request email info, and claim rewards with eligible purchases using their living-room remote.

It rolled out Amazon Prime Video with ads earlier this year as the automatic default subscription 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 allows advertisers to engage with viewers on a massive scale across desktop, mobile, and connected TV environments.  

Massive Audience Reach

Prime Video has an average monthly ad-supported reach of over 200 million global customers.   Roughly 80% of Amazon Prime users are on the ad-supported subscription.  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 research conducted by Amazon, advertisers who run both interactive and non-interactive video ads for their Amazon product listings found interactive ads to be more effective in boosting engagement rates across the customer shopping journey, driving 10x more product page views and conversions than non-interactive formats. 

Planning for Amazon Video Ad Tier

Amazon Prime Video CPMs is priced lower than competitor streaming platforms - around the low to mid-$30 range.

Amazon's 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.  

This shift offers brands a chance to capitalize on Amazon's extensive user data and the offer of targeted and effective advertising at competitive cost-per-thousand impressions (CPM) in the mid $30s range. Although Amazon limits ad inventory compared to traditional linear or other streaming services so this scarcity could drive competition and value.

For brands using this 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 can 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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