Oftentimes, these efforts go beyond the function of a typical ecommerce marketplace, as Amazon strives to be a leader in several different spaces, from media and marketing to shipping.
One example? The recent launch of Amazon Moments. Here’s what you should know about this new offering from the ecommerce giant.
What are Amazon Moments?
Amazon Moments is a marketing tool created by Amazon to allow brands to deliver physical and digital rewards to customers.
When customers complete a certain action on a brand’s app or website, Amazon delivers tailored rewards to those customers on behalf of the brand. Amazon Moments can be implemented on iOS, Android, FireOS (the proprietary operating system for Amazon’s Kindle Fire devices), and web.
As of its launch in February 2019, Amazon already had 20 brands onboard with the Moments tool, including Tik Tok, Bravo, Sony Crackle, Sesame Street, Washington Post, and Disney Heroes.
How do Amazon Moments work?
Amazon Moments offers a lightweight API that developers can integrate with their app or website. When a user completes the desired action, the Moments API provides them with a reward URL to redeem their prize through Amazon.
For physical rewards, Amazon handles fulfillment from their warehouses. Rewards must be products or digital downloads already available for purchase on Amazon.
Why use Amazon Moments?
Moments enables brands to reward customers when they perform a commercially valuable action in an app or on a website, such as renewing a subscription or referring a new user.
Amazon Moments allows brands to automate and streamline these in-app rewards.
Instead of having to set up a rewards program in-house, Moments allows brands to leverage Amazon’s product selection and fulfillment reach to offer rewards.
Brands and apps no longer have to be the middleman when providing rewards and gifts to their customers and users. Amazon’s global footprint allows brands to reward customers in over 100 countries.
“All the rewards that are part of the program are distributed through Amazon without the marketer having to worry about sourcing or the fulfillment of the rewards. Marketers only pay when they drive actions for their business.”
– Amir Kabbara, Head of Amazon Moments (Source)
In an effort to minimize abuse and fraud in these rewards programs, Amazon also claims that they have designed the tool to detect users who try to “game the system” for reward URLs.
Amazon Moments is still fairly new — it officially launched in February 2019 — so it’s hard to say exactly how effective the platform is for brands.
However, according to Amazon, Moments has increased engagement for a variety of apps, including a 20x increase in the percentage of first-time payers.
How much does Amazon Moments cost?
Moments uses a cost-per-action (CPA) pricing model, allowing brands of all sizes to scale their rewards programs through Moments based on their budget.
Ideally, these brands will be coming out ahead in the long-run; the rewarded actions should be those that will encourage future engagement and conversions from users and their friends.
It’s also worth noting that building a rewards program from the ground up can be cost-prohibitive, especially for smaller brands; companies reportedly spend more than $2 billion on loyalty programs every year.
But while it’s expensive to retain customers, it’s even more expensive to lose them — it costs 5x more to acquire a new customer as it does to retain an existing one.
Taking customer loyalty programs to the next level
Amazon Moments has come along at a time when more and more brands are striving to differentiate their rewards programs. Customer loyalty programs are incredibly common; the typical US household belongs to 14 different rewards programs.
Brands have to work harder than ever to stand out, increase customer retention, and build loyalty.
Many brands offer the entire rewards program through a branded app, requiring that customers download the app, scan it in stores, and even make purchases through the app in exchange for points.
Tools like Amazon Moments and Smile.io, a platform that helps brands build out and automate customer reward programs and brand communities, are helping brands create these rewards experiences without having to start from scratch.
Bottom line is this: The more engaged and invested customers feel invested in a brand and its rewards program, the more likely they are to make purchases and interact with the brand — and share it with their family and friends.