Amazon’s ad business will get another boost with the rollout of a new API for self-serve ads
Amazon is beta testing an application programming interface for Amazon Marketing Services, the part of its ad business that encompasses self-served Amazon ads, including its paid search platform.
There has been an API for sponsored products reserved for sellers, but the company is now testing a separate API for brands, said an Amazon spokesperson, adding that the goal is to eventually have as much offered at a self-service and customizable level for advertisers as possible.
This development is notable, according to multiple agency buyers interviewed by Digiday. The API, which has been expected since this summer, will provide a “systematic approach to adjusting and reporting campaigns and offer capabilities to automate the ways campaigns work,” according to one buyer.
About 55 percent of online shoppers start product searches on Amazon, according to estimates by the oft-cited personalization company BloomReach. Paid search is a big part of the ad business — and adding an API that will connect it with the information and tools brands and agencies want would make it more powerful. “They have a super extensive paid search program, but tools for creating campaigns and reporting and monitoring campaigns are still basic. Any marketer wants capability or more data,” said one ad buyer.
It’s unclear who has access to the API, but one agency said eligibility depends on a combination of factors, including AMS spend.
“[Amazon] is throttled by the lack of an API,” said another buyer. “There’s so much less you can do without it.”
The company also made an API for Amazon Media Group widely available in the summer, and at the time, agencies said they expected a similar development for AMS. The API offered in beta covers Amazon Sponsored Products as well as headline search ads that lets brands programmatically manage campaigns, ad groups, ads, keywords, bids and budgets. “In addition, detailed reporting allows you to pull performance data to analyze sales and investments,” reads Amazon’s page explaining the API for sponsored ads.
At another holding company-owned media-buying agency, an executive said it’s had early access to an AMS API since early this year, but the agency was focused mostly on data aggregation and reporting, not optimizing. A week ago, API access was opened to headline search ads, and this executive said Amazon is moving product display ads to programmatic because it’s “less performance-driven.” “We have a wish list with Amazon,” said this executive. “We’re looking for more data, more sales-performance information; we want to be able to consolidate it when we run multiple campaigns.
This is another sign of growth for Amazon’s programmatic ad business, which has slowly but surely made progress in its offerings all year. In late August, Amazon opened up and evolved self-service for AMG, the group internal to Amazon that is more like a traditional ad buy that can include video across Kindle, sponsorships, displays and even out of home on delivery trucks. In June, it launched Advertiser Audiences, a self-serve audience-matching platform that is like Google and Facebook and lets brands build audience segments based on Amazon data.
APIs have proven to be critical to scale an ad platform. APIs let platforms compete against more mature platforms like Google and Facebook. Take Pinterest, which took a long time to put out an API, not doing so until 2015, a move that hurt it. And Snapchat, which launched an API in 2016 to let brands and agencies finally scale their ad buys.
The Amazon API is not yet widely available; one buyer said Amazon will open it to everyone in the industry early next year. It’s a pretty significant step for Amazon’s ad business. As a behemoth, Amazon is poised to break up the Google and Facebook duopoly in advertising. Between AMG and AMS, Amazon offers what both Facebook and Google provide.
The problem is that Amazon’s offerings still lack the sophistication from the back end. Agency execs have been known to compare Google to a Lamborghini and Amazon to an old, automatic car. Improvements are coming — the self-serve option on AMG and other moves like Advertiser Audiences, for example — but an API for paid search would position Amazon favorably with Google and in a good position to take market share away from it. AMS is strategically important for the company: Open to first-party vendors (not third-party sellers, who can use sponsored products and headline search ads and that too only if they’re in Amazon’s “brand registry program”), the program is now giving promotional credits to brands that sign up before Dec. 31 for a new AMS account that will expire at the end of January next year.
Amazon reported two weeks ago that in the third quarter, “other” revenue, which is mostly composed of ad sales (and to a much smaller extent, its credit card business), grew 58 percent year over year to $1.12 billion.
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