Competitor streamers are piling into Amazon DSP
This week, Netflix announced that it has partnered Amazon Ads to bring its premium ad inventory to Amazon DSP, the company’s demand-side platform.
Beginning in Q4, advertisers in the US, UK, France and other leading ad markets will be able to access Netflix via Amazon DSP.
It follows a similar partnership, announced in June, between Amazon DSP and Disney’s Real-Time Ad Exchange, which allows advertisers to gain access to Disney’s premium inventory on Disney+ and ESPN through Amazon DSP.
In the same month, Amazon Ads also integrated Roku’s connected TV inventory into Amazon DSP.
The tie-ups aim to leverage insights from both the streaming services and Amazon’s retail network to provide more effective targeting for advertisers. As Kelly MacLean, Amazon DSP vice-president, said following the Disney deal, Amazon Ads is seeking to “[break] down traditional barriers between content and commerce signals”.
On the buy side, InfoSum, the data platform recently acquired by WPP, announced in May a set of integrations with Amazon DSP and Amazon Marketing Cloud, with the goal of enabling capabilities including lookalike modelling, retargeting and audience suppression.
Netflix president of advertising Amy Reinhard said the partnership “perfectly aligns with our commitment of bringing advertisers even greater flexibility in their buys to achieve their marketing goals”.
She continued: “By integrating Amazon DSP and enabling even more advanced capabilities together over time, we’re making it easier than ever to connect with Netflix’s global engaged audience.”
Analysis: A win-win?
According to the latest IPA TouchPoints report, ad-supported subscription VOD (SVOD) services have collectively tripled total audience reach in the past year as consumers have increasingly adopted cheaper ad tiers.
Kantar has found that over one-third of all new paid streaming TV subscribers in the UK have chosen ad-supported tiers.
Netflix reported in May that its ad-supported tier reaches 94m monthly active users globally.
Netflix, Amazon Prime Video and Disney+ have consistently remained the three largest streaming services in the UK by subscribers and thus audience reach. According to TouchPoints data, the most popular ad-funded SVOD platform in the UK is Netflix (16% reach), followed by Amazon Prime Video (15%) and Disney+ (7%).
The latest Q2 Barb Establishment Survey data, released on Thursday, found that Netflix reached 17.6m UK homes (59.6%) in Q2, with 31% on its ad tier (5.5m).
Prime Video, meanwhile, reaches 13.7m UK homes (46.6%) — the vast majority (87% or 12m homes) of which are on its ad tier due to that being the default option.
Disney+ reaches 7.6m UK households (25.7%), with 28% (2.1m) on its ad tier.
The fact that all of their ad inventory can now be accessed in one place, with additional insights from the rest of Amazon’s businesses, appears like a win-win for advertisers and the entertainment giants.
Amazon Ads senior vice-president Paul Kotas said that even amid a fragmented TV landscape, Amazon DSP’s goal is to “remove the guesswork for advertisers by making it simple to manage all of their TV planning and buying”.
Advertisers wanting to understand how a TV ad via Netflix could directly lead to a sale on Amazon’s retail site, for example, will now be able to understand that consumer pathway more easily. The move similarly opens up more retargeting options for brands.
Richer data
As Chris Cochrane, co-founder of independent programmatic ad business Plug Media, wrote for The Media Leader last year, Amazon’s ecosystem includes both consumer making active purchases on its shopping platform and engaging with content across Kindle, Amazon Music, Twitch and more.
“From a DSP standpoint, this offers a rich dataset for audience targeting and segmentation,” he said. “Moreover, Prime Video’s ad product integrates seamlessly with the broader Amazon advertising ecosystem. This means advertisers can combine display advertising with sponsored product listings, as well as video and audio ads, to create a comprehensive campaign strategy.”
Notably, the tie-up with Netflix follows the latter launching its in-house adtech stack to all 12 of its ad tier markets in June.
While working with Netflix’s own adtech is billed as a way for advertisers to access enhanced data capabilities, first-party measurement solutions and additional options for programmatic buying, the platform has broadly embraced an open model for ad buying.
In February, Netflix expanded programmatic buying via third parties Google (Digital & Video 360) and The Trade Desk to EMEA.
As Damien Bernet, Netflix’s EMEA ads vice-president, told The Media Leader at the time, the programmatic tools are aimed at “making us easy to buy”.
He called programmatic buying “the bread and butter of the business” and necessary “to enable us to scale”.
Amazon Prime Video’s ad introduction will revolutionise connected TV