Amazon Wants to Move Beyond Retail Media
Less emphasis on shoppable TV, more on full-funnel
Amazon held its fourth annual unBoxed event this week in Austin, Texas, and if you drank every time they mentioned the term “full funnel” - well, you might as well funnel a few Busch Lights.
One thing that stood out - at least to me - was how much Amazon executives talked up helping all kinds of brands advertise (not just Amazon sellers), and how the eCommerce giant was (in their view) uniquely positioned to assist with every form of media strategy and tactic.
The not-so-subtle underlying theme was - yes, our ads are incredibly effective at driving conversions - helping sellers sell stuff - but we can do so much more.
And perhaps, we don’t need to make everything shoppable, or limit ourselves to being known as the shoppable ad company. We may have invented Retail Media - but we’re really about all advertising.
You get the point.
For example, one of the great promises of Amazon getting further into the TV business was that if anyone could - Amazon would make TV-commerce happen. In fact, shoppable TV was a pretty big focus at unBoxed two years ago.
It was easy to imagine that soon you’d be streaming Thursday Night Football and start seeing a bunch of personalized ads based on your shopping habits, and then you’d begin adding items to your Amazon cart left and right, right from the couch.
Yet despite rolling out a handful of commerce-oriented ads during this year’s upfront, the marquee unBoxed keynote on Tuesday scarcely touched on shopping via the TV remote.
Instead, Amazon talked up its ability to follow customers throughout their journeys, and their unique ability to tie together all sorts of data signals, along with a new multi-touch attribution product.
To be sure, Amazon’s pitch this week may have been specifically tailored to the unBoxed audience. I wasn’t there in person this year, but typically the event is filled with people who sell products on Amazon, not necessarily CMOs or top media buyers. So maybe Amazon is just trying to get these long tail merchants to do more than just buy search ads.
Or, it could be that Amazon doesn’t feel as compelled to reinvent TV advertising around shopping considering that it just made a killing in the TV upfront by mostly selling regular TV ads.
Or, Amazon is trying to move beyond selling ads that lead to instant clicks and conversions - and go for a much bigger piece of the media pie. It’s actually a playbook out of marketing 101 - building demand, using different media vehicles to accomplish different goals in concert, etc…but it’s not very Amazony. Or at least it hasn’t been to date.
Hasbro Provided a Good Example of Where Amazon Wants to Go
In a case study presented at unBoxed, Jennifer Burch, Hasbro's head of global media, talked about a campaign the kids brand ran recently via Amazon Prime centered around episodes of shows like Peppa Pig. Hasbro wasn’t trying to get kids or parents to shop via those ads, but rather to check out their products on Amazon and other sites at another time - all of which Amazon said it can track.
“Gen Alpha and Gen Z are inundated with ads,” Burch explained. “So we need to build deeper connections …while reaching new-to-brand consumers.”
Hasbro’s agency partner Kepler talked about the importance of marrying brand spending with its performance strategy. “The purchase journey is incredibly complex,” said Remy Stiles, Kepler's North American CEO. “It’s all too easy to get very focused on the point of sale. We still need to keep our brands top of mind, and need to create demand.”
That’s a very ‘full-funnel’ approach, which is not typically what defines retail media, and hasn’t necessarily been Amazon’s advertising sweet spot (which has been all about how the funnel had ‘collapsed.’)
But it’s where the company wants to go, as it eyes a much bigger ad prize (i.e. all of the ad budgets).
“We needed to bring direct and brand together, and we were really able to see what brand drove,” said Burch. “And it worked.”
A few other macro observations from UnBoxed:
Amazon took some thinly-veiled shots at rivals. ‘Hey cookies are dying, and we don’t need them anyhow.’
Multiple executives on stage at unBoxed talked about how the inevitable end of the cookie wasn’t going to be a bad thing, (what signal loss?) since at Amazon, we have “an abundance of signals” or “trillions of signals.” Without naming names, Amazon seemed to be poking both Google and The Trade Desk.
“We can no longer rely on cookies,” said Claire Paul, vp, Global Marketing. Amazon Ads. And, “We don’t believe that replacing cookies with another identifier is the way to go…but we can deliver highly relevant ads…Without relying on a single ad identifier.”
Not to mention that Amazon’s newly revamped DSP has just a “1% take rate” (which differs from Google’s, at least based on the ongoing anti-trust trial, as well as others in the space).
Amazon really talked up AI media optimization
“We have all these incredible touchpoints with customers,” said Paul. “We can build and activate audiences…we can answer questions such as ‘how many times do customers need to see an ad before they convert?’”
Like Meta and Google, Amazon is touting its growing AI media planning capabilities, with a pitch along the lines of: ‘give us your data, your goals, and our algorithms and tech will figure out the media plan and refine it along the way.’ Which I imagine is both compelling, and scary for brands. Regardless, we appear increasingly heading to as world where only a handful of tech giants have the data, tech and AI to manage media plans - or so they say.
Amazon wants to lead on generative AI creative
This came up during multiple sessions at unBoxed. Amazon caters to millions of brands that don’t have big agencies, and want to be able to produce and adjust creative on the fly. So let Amazon - or its partner Canva - make the ads for you! Which makes sense, but it seemed clear that Amazon also wants to broaden this offering, and bring it to TV and audio - which could threaten creative agencies and production firms over time (if the ads are any good, that is).
In case you missed it, check out my interview with Roku’s head of ad innovation Peter Hamilton. He’s a big believer in the idea that performance brands - particularly those born on social platforms, are poised to jump into CTV in a big way.