Amazon launched over-the-top (OTT) video advertising through Amazon Advertising earlier this year. Here’s what advertisers need to know about Amazon OTT Advertising — and why you should care.
What is Amazon OTT advertising?
Over-the-top (OTT) video refers to streaming TV and movies over the internet without a traditional cable or provider.
OTT video advertisements stream through cable boxes, gaming consoles, and other connected devices, like the Amazon Fire TV stick. OTT video inventory bridges the gap between traditional television and modern digital media by allowing advertisers to apply programmatic targeting precision to streaming media.
OTT has become mainstream in recent years, especially for younger audiences, whose viewing habits have shifted from cable viewing to streaming services. About 60% of young adults say the primary way they watch TV is through streaming services.
Savvy advertisers know that there’s an opportunity in OTT ads: OTT ad spending is predicted to hit $2 billion this year, and advertisers need to get in on that trend as soon as possible — or risk falling behind.
So, where does Amazon come in?
How does Amazon OTT advertising work?
Amazon’s Fire TV has 37 million monthly active users, making it a leading OTT platform. Amazon has seen the usage of ad-supported Fire TV apps increase over 300% in the last year. In addition to Prime Video, Fire TV includes over 50 third-party, ad-supported apps, including AMC and Pluto. Each of these apps gives advertisers more opportunities to reach their target audience via OTT ads.
Amazon OTT ads run on Amazon’s demand-side platform (DSP) platform. These non-skippable, full-screen ads let advertisers reach millions of people across Fire TV’s growing inventory. Advertisers can target specific Amazon audiences, but keep in mind that these ads are not clickable, so success metrics should focus on brand awareness rather than clicks or direct conversions.
Amazon DSP lets advertisers programmatically buy video placements. Programmatic advertising uses data to decide which digital advertising spaces to buy and how much to pay for them. Amazon OTT advertising lets advertisers leverage the programmatic advertising and audience targeting features of Amazon DSP — with full-screen video ads.
Some of the most popular ad-supported programs and apps on Fire TV include:
- IMDb TV
- NFL Thursday Night Football
Reach a targeted audience
The insights offered through Amazon DSP helps advertisers make their campaigns more targeted than a more widespread television audience. This helps brands engage with more relevant audiences, which, in turn, means that ad spend goes farther and leads to more conversions.
Amazon DSP offers audience insights to help advertisers understand and target their audience based on a variety of factors. Amazon’s Audience Solutions let you reach audiences based on their:
- Interests and behaviors, such as specifically shopping for products in a certain category
- Demographics, such as age, income, or education level
Within the behavioral audience targeting, Amazon has three segments:
- Lifestyle segments that reflect broad interest groups (such as homeowners)
- In-market segments based on what customers have searched for or browsed
- Retargeting segments made up of Amazon shoppers who have viewed but not purchased your products
Amazon OTT ads let advertisers combine the effectiveness of digital media with the power of Amazon DSP’s audience targeting.
Control your spend
Amazon Publisher Services (APS) integrates directly with OTT apps to remove intermediaries and their fees. This lets advertisers see exactly what they’re paying for. OTT ads are also easier to track the success of than traditional TV advertising. According to eMarketer, the average cost-per-minute of US primetime TV ads has almost doubled over the past decade.
According to Ryan Mayward, the director of ad sales for Amazon Advertising: “Amazon DSP is not subject to the 15% supply-side fee that other DSPs are when using APS.” Advertisers using Amazon DSP can also access inventory that other DSPs can’t. “With the Fire TV inventory optimization policy, ad-enabled apps reserve 30% of their total advertising impressions for Amazon. So with Amazon DSP, you have access to more inventory, and you’re also benefitting from a more efficient supply path with no ‘tech tax’.”
Amazon OTT advertising offers advertisers plenty of shows and streaming events to advertise alongside — with more controllable ad spend. OTT lets advertisers stick to a more strategic budget and spend on a smaller scale than traditional TV ads.
How to get started with Amazon OTT advertising
You can access Amazon OTT advertising inventory through the Amazon DSP. Advertisers can link directly through Amazon’s DSP or via a partner with access to the Amazon DSP (like Tinuiti!).
When setting up an Amazon DSP campaign, we recommend following these steps:
- Set goals for your DSP ads: Focus on brand awareness
- Identify your audiences: Use Amazon Audience Solutions to understand and target your audiences
- Choose strategic placements: Which Fire TV inventory items make the most sense for your brand?
- Build out and execute your campaign
- Analyze and optimize
- Do it all again!
To learn more about getting started with Amazon DSP advertising, check out this guide to driving brand awareness through DSP.