Amazon’s ad affinity —
Amazon is adding three types of shoppable ads to Prime Video’s ad tier.
Scharon Harding
– May 7, 2024 10:55 pm UTC
Enlarge / A scene from the Prime Video original series Fallout.
Amazon Prime Video subscribers will see new types of advertisements this broadcast year. Amazon announced today that it’s adding new ad formats to its video streaming service, hoping to encourage people to interact with the ads and shop on Amazon.
In January, Prime Video streams included commercials unless subscribers paid $3 extra per month. That has meant that watching stuff on Prime Video ad-free costs $12 per month or, if you’re also a Prime subscriber, $18 per month.
New types of Prime Video ads
Amazon has heightened focus on streaming ads this year. Those who opted for Prime Video with commercials will soon see shoppable carousel ads, interactive pause ads, and interactive brand trivia ads, as Amazon calls them. Amazon said that advertisers could buy these new displays to be shown “across the vast majority of content on Prime Video, wherever it’s streamed.” All the new ad formats allow a viewer to place advertised products in their Amazon cart.
With carousel ads, subscribers will be pushed to shop “a sliding lineup of” products during ad breaks during shows and movies, Amazon said, adding: “The ad automatically pauses so that customers can browse, and automatically resumes play when ad interaction has stopped.”
The pause ads will be visible during Prime Video TV shows, movies, and live sports. These types of ads have been around since Hulu introduced them in 2019. Since they can show up whenever someone hits the pause button, these displays mean that Prime Video users will see ads beyond their scheduled breaks.
In Prime Video’s case, pausing the program will bring up “a translucent ad featuring brand messaging and imagery, along with an ‘Add to Cart’ and ‘Learn More'” overlay, per Amazon. Advertisers can also use pause ads to acquire voluntary viewers’ email addresses (so viewers can “get more information,” per Amazon).
Amazon trivia-themed ads will also appear during shows, movies, and live sports. The ad will try to sell stuff by offering “rewards like Amazon shopping credits.”
Amazon’s ad business is growing
Amazon is already one of the three biggest digital advertising firms (in addition to Alphabet and Meta). But its interest in using its streaming service to sell ad space has grown as ad dollars continue shifting away from linear, traditional TV platforms. The streaming industry has been trying to capitalize on advertisers’ growing interest with new ad types that users can shop from. Amazon research from 2023 claims that interactive ads increase product page views and conversions for products sold on Amazon tenfold.
On the other hand, Amazon has not released research publicly on how much constant ad viewing can impact the user experience or interest in a streaming service.
Still, Amazon claimed today that Prime Video ads reach an average of 200 million people monthly. Although, Amazon hasn’t provided a firm figure on how many Prime Video subscribers it currently has overall. In 2021, Amazon said that Prime, which includes Prime Video, had 200 million subscribers.
Amazon has, however, boasted about how well it is selling ads recently. In its Q1 2024 earnings report released on April 30, Amazon said its ad business grew 24 percent year over year. Most of Amazon’s ad dollars come from its retail business, as The Hollywood Reporter noted, but in a statement at the time, Amazon CEO and president Andy Jassy noted that Prime Video was also a contributor.
According to a Hub Media Entertainment survey from January to March 2024, 6,338 US TV viewers between 16 to 74 years old watched at least one hour of TV per week, and 85 percent of Prime Video subscribers in the survey are on Amazon’s ad tier. (Amazon hasn’t confirmed those figures.) The Hub Entertainment Media survey claims that Amazon has a higher ad-based to ad-free ratio of subscribers than all other video streaming services examined, including Netflix, Max, and Hulu. But it’s worth noting that Amazon automatically moved all Prime Video subscribers to its ad tier in January, while others, like Netflix, introduced ad tiers as a new option to sign up for.
A fine line
Like all streamers, Amazon is toeing a fine line between using ads to boost the average revenue it makes per user and aggravating subscribers to the point of cancellation.
Amazon is already facing a lawsuit regarding ads on Prime Video that seeks class-action certification and was filed by people who purchased annual subscriptions.
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