Could Amazon Be on a Path to Take Over TV Ads?
Would big TV networks, and brands, be ok with a 'crystal box'?
As much as there has been extreme hype and real business traction centered around artificial intelligence and media buying - TV has sort of emerged as a No-AI-Zone.
Despite all the excitement over how quickly TV is being overtaken by streaming, and TV advertising by ad tech, when it comes to ad buying and selling, the industry still operates in a fairly traditional manner.
While tech giants like Meta, Google, Pinterest and TikTok increasingly offer fully-automated, algorithm-driven ad buying and optimization, lots of money still flows through insertion orders. And the little that is traded programmatically is driven by control-oriented mechanisms such as programmatic guaranteed and private marketplaces. There isn’t, to my knowledge, a TV version of Google’s Performance Max, and I haven’t seen anyone touting one.
After all, you can build a terrific AI-buying tool for TV- but if you don’t have access to lots of inventory, it won’t be very useful. And TV is a rather closed universe of a dozen or so top US players.
However, could Amazon be the (unexpected) driver of AI-driven TV? And would the TV industry let this happen?
Maximize your YouTube advertising with VuePlanner. As a member of the YouTube Measurement Program for Brand Suitability and Contextual Targeting, VuePlanner enables you to buy with confidence, clarity, and precision. Using advanced technology and AI-powered optimization, VuePlanner offers custom-curated contextual collections, exclusive content strategies, and transparent reporting for measurable, impactful results. Take control of your campaign performance—partner with VuePlanner now.
____
I had Kelly MacLean, vp of Amazon Ads, on my podcast this week, and while she didn’t proclaim any broad mission for the e-Commerce titan to take over the TV universe, you could maybe parse some clues about where she and the company see Amazon’s DSP is headed.
Since she joined the company in 2023, Amazon’s DSP has “shifted from single purpose to multi-purpose,” as “full funnel is becoming more critical. Cross-channel reach and measurement are starting to take center stage.”
“We were building a system that would drive growth for all digital marketers across verticals and advertiser sizes and really kind of pivoting our focus, leveraging all of the power of what had been built and the power of the integration with the Amazon store, but thinking about what are the investments we need to make technically to help us scale, you know, for the next five to 10 years.
This is about “full funnel outcomes across all premium media.”
Amazon wants to “increase efficiency and lower the cost of managing campaigns, but all backed by AI. And so this also means for marketers, it has to be easy to deliver across all premium publishers.”
Much has been written about how Amazon’s DSP has been coming on strong over the past year, and has been increasingly adopted by brands thinking outside of the retail media box. A lot of that growth has been understandably framed as what it signals in the current programmatic space - and specifically for The Trade Desk.
And it’s clear that while TTD has historically about the ‘open web’ and the little guy long tail publishers fighting against Google’s monopoly - Amazon is specially talking “premium” and “all media.”
Thus it seems that the battle is much large than a DSP vs. DSP war.
After all, how much does it matter which advertisers use which DSP over the long haul for display advertising and even web video, as the web shrinks before our eyes (even Google is saying so) and consumers get answers instead of visiting sites.
In the meantime, there is already some talk about a new breed of AI-driven companies making DSPs less integral. Marketecture’s Ari Paparo has written about this disintermediation, and on the Marketectutre podcast he talked about how curation and AI optimization tools are taking away some of the core reasons buyers use DSPs
“Some of those [use cases] are starting to be eroded,” he said. The promise of some agentic AI startups is, “we’re gonna do all the targeting and optimization for you.” For DSPs, “that’s almost like taking the engine out of the car.”
So if Amazon vs. TTD - is just a DSP battle - that may be about a war that no one wins. But if you look at Amazon’s broader moves:
The company announced a TV targeting integration with Roku in June, which essentially lets advertisers buy ads using Amazon’s killer ID data, on a much broader slice of the CTV landscape than just Amazon Prime
Along those same lines, Disney opened the door to using Amazon data (and its DSP) to run targeted campaigns on Disney property. (Remember, Disney likes to tout just how broad its programmatic reach and audience graph is, yet it’s partnering with a rival)
Even, to a lesser extent, a recent pact with Macy’s, while centered on retail media, not TV per se, could indicate how much big companies are willing to concede that even when they have solid consumer data, Amazon’s is more potent
So I’m wondering if the long game for the Amazon DSP is be everyone’s DSP for television ad buying - and maybe evolving into thee AI platform for TV advertising.
“If you boil all of this down, our key differentiators are really those signals, the trillions of browsing and streaming signals, the premium inventory and reach,” MacLean said. “We have the largest premium reach across the open internet….and deterministic identity across Prime Video and the majority of all premium pubs….and then ultimately just kind of underpinning all of that with tech and interoperability.”
Sounds great. Then again, Dan Larkman, CEO at Keynes Digital, wonders why brands that don’t sell on Amazon would ever want to hand over too much of their media activity to the platform . “There is more risk than reward.”
Over the past several years, many marketers have had to wrestle with what’s best for them in the short term (making money selling on Amazon.com) versus protecting their brands and their direct relationships with consumers. The same questions may arise when it comes to how much they allow Amazon to insert themselves into their advertising strategies.
“Amazon has a ton of data,” said Larkman. “But if I'm a brand and I'm going to use Amazon Pixel to serve my ads, how is Amazon going to use that data? Probably the same way Meta does.”
Meaning, Amazon would be able to use advertisers’ data to sell ads to competitors.
On the media side of things, the question is who else might want to interoperate with Amazon? How much will other top TV ad sellers providers want to let Amazon in, either through matching up IDs, or even fully handing over ad inventory to let an AI tool run wild?
Well, to be sure, YouTube is a dead end, given- Google. This is speculation on my part, but wouldn’t Paramount be an interesting candidate? New owner David Ellison has been super bold thus far, but his focus has been mostly on content and technology. Unless I missed it, he hasn’t layed out much of an advertising vision. Maybe he’d be willing to outsource a portion of his CTV inventory to an Amazon. And if Paramount starts buying up or partnering with other top TV players (Warner Discovery? Comcast) - who knows.
[**IN FACT - a day after this post, Amazon inked a deal with Netflix. Whoa!]
After all, at a certain point, you could see many of the top media companies - already in cost-cutting mode - realizing it’s easier to plug into an ad partner than to build, or staff all of this stuff on their own.
This of course assumes that brands would be ok with TV fully embracing all that comes with AI buying. After all, you see many traditional advertisers pining for more control and transparency in CTV, not less.
“The risks really come down to this,” said Larkman. “Will the brands let it become more automated again, and will the TV ecosystem allow it? Potentially.”
Of course, there’s no stopping the two largest online ad sellers, and the two companies with the biggest traction in AI media buying, to make a bigger push into CTV: Meta and Google.
The challenge for Meta is simple - the company doesn’t have a TV presences, or TV ad inventory.
In the case of Google, there would seem to be a much easier path for the company to say, roll out a TV version of Performance Max (especially since YouTube is already such a big part of the offering). But again, they’d need other inventory sellers to play. ball. Are TV sellers going to let Google into their world in a bigger way? Would brands be ok with Performance Max’s black box reputation in television?
That’s where Amazon could maybe have a leg up? According to MacLean, the current AI-powered DSP can offer the best of both worlds - or as she dubbed it, a “crystal box.”
'“Let's make sure that [using our DSP] can be easy,” she said. “And if you want to set up with a couple inputs or prompts or constraints, you can do that, but we will still provide you the transparency optimization control and transparency on reporting so you know where your ads are going.”
For many advertisers, especially those new to television, that may sound just right.