- Amazon is making a big play for TV ad dollars, touting a TV audience of 120 million users.
- Ad buyers see a big opportunity for Amazon but say IMDb TV and Fire TV lags rivals.
- They also have concerns about their ads appearing on Amazon’s Twitch.
- See more stories on Insider’s business page.
Amazon is ramping up its pitch for streaming TV ad dollars.
Amazon has quietly built out an ad-supported TV platform and formally pitched it to advertisers for the first time in May with an eye-popping stat: 120 million people watch its ad-supported video, from 20 million in January 2020.
Four ad buyers who spoke with Insider gave Amazon’s pitch mixed reviews. They said that Amazon has strong targeting data and pricing competitive with other streamers. Its ad load is also lower than linear TV with six minutes of ad time per hour — comparable to other streaming services and down significantly from linear TV’s average of 22 minutes. But they said that Amazon lacks compelling content to nab TV budgets.
Like other streamers, Amazon hasn’t made a big dent in that business. Mike McHale, head of activation at ad agency Noble People, estimated that only 5% of OTT ad budgets come from linear TV budgets with the rest coming from digital.
Amazon’s pitch comprises four properties:
- Fire TV: Amazon’s streaming device housing publishers’ apps.
- IMDb TV: Amazon’s ad-supported video app with TV shows and movies.
- Live sports: Rights to sports games, including some NFL games on Amazon Prime.
- Twitch: Creators’ live-streamed content.
It’s not alone. New and legacy sellers including Roku, YouTube, NBCUniversal, Disney, Viacom, and WarnerMedia are also vying for a piece of the $70 billion TV business. EMarketer last year found that YouTube,
, and Roku claimed half of OTT ad budgets, with Amazon making up a big part of the other half.
Amazon pitches data that advertisers love
Amazon says it can help advertisers reach cord-cutters and zap ads at people who have bought specific products on Amazon or watched a show on Amazon Prime — a compelling pitch to advertisers seeking first-party data with the phase-out of third-party cookies and rise of privacy regulations.
Advertisers can target programmatic ads at people who have watched a Prime show with a specific actor within the past 30 days, for example, said Prerna Talreja, managing director of digital activation at CrossMedia.
“Everyone has data on viewership, but Amazon has viewership data and shopping habits,” she said.
Amazon is also testing letting people add products advertised in commercials to an Amazon shopping cart as a way to prove its ads drive sales.
Advertisers like Amazon’s sports but want more premium content
Amazon also has an edge in live sports — especially football.
Amazon streams some NFL games on Amazon Prime and recently inked an 11-year deal to exclusively stream 15 Thursday Night Football games starting in 2022, and McHale said that ad space there sells out almost instantly.
“So much sports money sat on the sidelines in 2020 that people have a voracious appetite for anything considered premium and non-skippable,” he said.
But beyond sports, advertisers say Amazon’s programming lags ad-supported competitors like Hulu and NBC’s Peacock.
Samantha Rose, SVP of advanced TV and video solutions at Horizon Media, said that she’d like to see more original and popular syndicated series on Amazon.
“They have some originals and syndicated shows but it doesn’t feel like they’re a major player yet,” she said.
IMDb TV also has plenty of competition from other ad-supported streamers like Tubi, PlutoTV, and Xumo, and their audiences lag linear TV.
In February, Amazon said that its video ad platform, including IMDb, reaches 55 million monthly users. Tubi has 40 million monthly users while Pluto TV has 50 million users. Nielsen estimated last year that there are 121 million TV homes in the US.
Advertisers are cool on Twitch
Amazon is starting to sell
to brands, but buyers said its user-generated content doesn’t measure up to TV-quality content and can scare off some advertisers.
“It’s a different product from buying streaming CTV, which is full-episode, long-form content that is a TV replacement,” said Rose.
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