‘A growing ecosystem’: With new partner directory, Amazon signals maturity of its ad business
Amazon’s advertising platform continues to grow.
Earlier this week, Amazon Advertising released a new directory of managed-service providers and tools to help marketers in the U.S. using its ad platform. Much like the advertising duopoly of Google and Facebook before it, which both released directories of preferred service providers as their advertising businesses grew, Amazon is looking to help brands figure out who to work with to understand its ad business.
With the creation of this directory, Amazon provides a sense of direction and simplifies the search for retailers and marketers who may need an advertising partner for its platform. At the same time, the company is signaling that its advertising business has matured and that it wants to have a bigger hand in helping retailers and marketers figure out the ecosystem around it.
Figuring out that platform — a unique combination of advertising and commerce — has become a specialty and a cottage industry of sorts. The existence of that cottage industry is nothing new, with agencies and other various service providers emerging in recent years all pitching their knowledge of the platform to clients. But now, with this directory, Amazon is giving marketers a sense of who’s who among those service providers and tools and giving a boost to agencies that it believes have provided a “high level of engagement and proficiency” with the business.
While the list in its current form may be a snapshot of the larger Amazon provider landscape, media agency sources believe it will grow and expand over time to include more providers, especially as Amazon grows its ads business from one primarily built on search to focus on advertising on FireTV, Twitch, Amazon Audio and more. It’s unclear how Amazon picked the list, what quantification may have been needed or if there are perks for being part of it, as Amazon did not immediately respond to a request for comment.
“Amazon has grown its advertising capabilities quickly, which has spawned countless Amazon-focused vendors,” wrote Jason Hartley, svp, national head of search and paid social at 360i, in an email. “That has led to a bit of a Wild West atmosphere, and I think this is an effort to bring some order to brands who are ready to grow their presence on Amazon.”
Amazon Advertising isn’t the only business that the company has created a directory of service providers to help its clients. The company also created a directory for its Amazon Web Services business. “Think about where Amazon makes their money; they make a lot of money with AWS and with [advertising] media,” said Eric Heller, evp of marketplace services at Wunderman Thompson Commerce. “For people working with them to find value in those programs — they’re complex — it behooves everyone to grease that and make it work better.”
During the second quarter, Amazon reported $3 billion in what it categorizes as “other” revenue, which is mostly made of up revenue from advertising. That’s a slower growth rate compared to the second quarter last year, just as the first quarter showed, as the platform is maturing.
“[This is] absolutely a sign of a growing ecosystem and the overall influence of Amazon as an advertising platform,” wrote Kevin Packler, vp and director of Amazon services for Tombras, in an email. “For example, many of the companies on this list didn’t offer Amazon services or even exist five years ago. With Amazon’s reach growing in paid search and via new platforms such as Fire TV and Amazon Audio Ads, for example, the proliferation will only continue.”
For example, Channel Bakers, an full-service Amazon agency founded over four years ago is on the list.
As Amazon Advertising’s offerings continue to grow, so too will its ad business. The need for agencies and other service providers to be experts in advertising on Amazon doesn’t exist in a vacuum. While the company has grown its ad business quickly it has not been without its own issues. “They’ve made a lot of progress in the last couple of years, but there are still some structural obstacles for them to make the most of their platform,” wrote Hartley.
One of the biggest obstacles for Amazon’s ad business is that brands can’t treat Amazon as they would any other advertising platform. That not only creates the ecosystem of providers that the directory is meant to help brands with but can be a headache for brands who want simplicity when it comes to how they manage their ad dollars. If they have one team managing other platforms and another managing Amazon, that can create a lot of back and forth. With the directory, marketers are able to see which agencies they can tap for both rather. Amazon is also able to be a somewhat neutral third party, as the directory helps point brands where to go but doesn’t tell them who to use.
“Amazon is bridging the gap for those advertisers who rely heavily on their agencies as full service shops,” wrote Bruce Kiernan, managing partner and head of commerce in the U.S. at Wavemaker, in an email. “We’ve reached a pivotal moment in our industry where clients are asking for more hybrid solutions.”
While the dashboards Amazon offers to clients have gotten better with a more complete picture of the data, according to Heller, some data is still only available through third-party vendors.
“Data is getting better about the Amazon ecosystem,” said Heller. “At the same time, as large holding companies and the like are adding Amazon credibility, what we’re seeing is a revolution of software and data-providers coming up to support brands in this space. Folks dedicated on reporting and supporting operational data, folks dedicated to supporting on brand health and reputation. Two years ago, it was very hard to get this data. Now, for $200 a month on a corporate credit card you can get a raft of data.”
How Roblox is paving the way for a new era of branded gaming
Roblox is still in its infancy as a marketing tool. But over the last two years, the number of brands and retailers on Roblox has grown dramatically.
‘Email has become so cluttered’: Why DTC brands plan to use texting for Black Friday and Cyber Monday this year
With Black Friday and Cyber Monday nearing, text messaging is becoming a more common marketing channel for direct-to-consumer brands.
‘There’s more opportunity’: Publishers on TikTok are taking branded content into their own hands
As their audiences on the social app have grown, a flurry of publishers have turned to developing branded content campaigns to explore new commercial opportunities.
SponsoredPublishers will lead the charge as cookie-less advertising becomes the norm
Steve Wing, managing director, EMEA, Magnite As the advertising industry moves closer to a cookieless world — one in which browserless environments including connected TV (CTV) and mobile in-app are an increasingly large part of ad budgets — publishers will have an increasingly important role in developing the future of identity. Segment creation and identity […]
Member Exclusive‘A more hopeful future’: As the coronavirus surges, advertisers aren’t pressing pause
Spending has remained consistent, according to media buyers, who say that advertisers are more prepared this time around.
‘Time to test multiple offers’: Why Black Friday and Cyber Monday advertising is coming earlier than ever this year
The accelerated shift of consumer shopping to e-commerce and the expected surge of online holiday retail, has led to earlier Black Friday and Cyber Monday advertising.