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Is Amazon OTT Advertising Right for Your Brand?

By Joshua Kreitzer E-Commerce Times ECT News Network
Feb 29, 2020 4:00 AM PT
amazon's ott advertising can help brands reach highly segmented audience targets

Perhaps you're a direct-to-consumer brand trying to build brand awareness and tell your story. Perhaps you're looking to increase branded search volume across search engines like Amazon, Google, Bing and others.

Maybe your brand is focused on new customer acquisition in your sales funnel and you have dedicated marketing resources and asset creation. Maybe your brand doesn't have a large enough budget for traditional television advertising but you still want your brand featured on televisions across the country.

If that's you, then you might want to consider taking a closer look at Amazon's OTT platform.

Understanding OTT

What does OTT mean? It's an acronym for "over the top." OTT services deliver video content over the Internet without using traditional coaxial cable network connections. OTT is similar to ConnectedTV, or CTV.

For people who have connected devices such as XBox, PlayStation and the like, the concept of OTT and getting around the network cable company is not new at all. These devices traditionally let us choose from a slew of different apps (Netflix, Hulu, etc.) and deliver over-the-top content -- or what also might be called "video-on-demand" -- with more flexibility and in a familiar format.

One argument for running an OTT campaign is that you're able to target the "cord-cutters" or "cord-nevers" who are otherwise a hard-to-reach audience. If you have a brand that's launching a new product, being able to mount an OTT campaign that hypertargets through lifestyle segments and historical purchase histories could help you reach a more refined audience.

Amazon OTT, specifically, is Amazon video advertising delivered via a Kindle device or a Fire TV Stick, and/or through its Prime Video and IMDb TV media properties, free television, or apps on its network.

With Amazon OTT, you're putting your asset -- generally a video asset that you also might use for linear TV -- into a digital format that allows you to target people from a programmatic perspective using the vast amount of data available to Amazon advertisers.

What "programmatic" means is that it allows you to do the buying a lot faster than buying it yourself the traditional way through direct deals or by purchasing a "target market." Your ability to refine and measure your audience increases immediately.

Refined Targeting

OTT allows you to access a format that is now. It lets you target people off traditional television where many brands are spending a substantial amount of money, and allows you to target people using a data-driven strategy. Because we live in a world of performance marketing, we need to show a benefit for the placements that we buy, even out-of-home placements on programmatic display.

It's no longer the linear TV broadcast approach to casting a massive wide net, when your choice was to put an ad unit on a particular network at a particular time during a particular TV show, with the hope or belief that the demographic you were targeting in that space would align with your product. Operating on the old saying that "80 percent of all ad dollars are wasted" is no longer acceptable.

A few beneficial things about Amazon OTT: You have the option to geotarget consumers, and/or you can target segments of people by lifestyle. It's possible to get significantly more refined and be able to say, "Would you like to target people between the ages of 20 and 30 in a specific geography that are also interested in music?" Or maybe you're a food brand looking for people in your market who are interested foodies.

You can start targeting segments focused on these groups, which is significantly better than linear broadcast television.

With Amazon OTT specifically, the data that you get in order to target a consumer is substantially greater than many other data sets out there. It certainly allows you to target people on a demographic label that is pretty traditional -- for example, males between the ages of 25 and 40 who make US$50,000 a year.

OTT can do that, but it also can drill down into Amazon-specific data that targets people who are browsing in particular categories, like televisions or shampoo. Based on consumer purchases within a specific category, it's possible to target people who are so close to your type of product that you can spend what used to be your linear TV dollars more efficiently on programmatic using OTT.

This lets you get more bang for your buck and allows you to test different segments and engage with real customers in a meaningful way.

So the biggest benefit is the ability to purchase video placements instantaneously using the biggest treasure trove of consumer purchase data around.

This is great news, but a big question is whether it's right for your brand. Are you qualified?

Taking the Leap

Amazon OTT can reach a CPM of about $25 to $30, and has a minimum budget of $35,000 per campaign, if you're running direct with Amazon. Running campaigns at that CPM on OTT can be expensive for many brands. It's not for the faint of heart.

If your brand already is struggling to make an advertising budget work on search and you haven't activated display, then OTT is not for you right now. If you're on search and all you're doing on DSP is retargeting, then you're probably not going to engage on OTT. The dollars just aren't going to go that far.

Imagine that CPM is $30 minimum if you want to get 5 million impressions. That's sixteen thousand dollars! On the other hand, if you have a direct-to-consumer brand that has done traditional TV advertising, Amazon OTT has a vastly lower barrier to entry combined with all of the advantages of the data and targeting platform Amazon offers.

If you consider it that way, then that $16k will go father for you on Amazon OTT than it would go on linear television -- and you can clearly see the true impact it has had on your brand.

Can you clearly identify the audience you want to target? Important factors to keep in mind are brand awareness and brand reach. That is largely what OTT is for -- putting consumers into your funnel. Those are the two biggest things that OTT can do and what can be measured.

This platform really is meant to pull people into markets, so that when they're transitioning into the consideration phase, they are thinking of your brand first. When people are just beginning their research, it's one of the first few brands that they see that they likely end up buying.

Running your ads before consumers are getting into the category is a huge plus for brands. In addition to that, you need to define the key performance indicators, or KPI, you want to get out of your OTT ad campaign.

Amazon OTT is a great way to drive awareness, but my recommendation would be to ensure that you have full-fledged marketing effort that is going to support that same message on DSP (demand-side platform) and search so that consumers are clear and confident in your brand message.

Many times brands don't build out additional marketing efforts that layer those messages down appropriately, really guiding the consumer to purchase. The marketing efforts are split across multiple teams with little communication or coordination.

Advertising managers think, "Hey, I'll run this great linear TV ad," or "I'll just run this one big DSP campaign for the promotion I have running."

While you might see your branded search go up, if you don't have campaigns running within display to complement OTT, or if you don't have search campaigns running or social campaigns running to catch all the additional traffic you created with OTT, then you're blasting consumers with this beautiful ad that you spent some good money on, but they may or may not know where to go after the fact.

Is your brand the type of brand that will benefit from having your products on every Kindle device across America? Is your brand going national and you want to target new regions of the country that you are launching in?

Look at the KPIs you are trying to hit, or the goal you're trying to define. When you compare costs associated with linear TV ad buys versus Amazon OTT, the cost is actually a lot cheaper. That's the beautiful part of the platform: Your brand is paying only to reach the actual customers you want to address. Target, target, target.

What's still missing on Amazon OTT? It is currently "unengageable" compared to some of the digital platforms you can use. There is no option for pixel firing on Amazon OTT yet.

Consumers see the ad, but cannot engage with it, either to purchase directly or receive additional information. If the folks at Amazon are reading this, those would be great tools for advertisers in future iterations of OTT. If anyone can do it, Amazon will figure it out, and they likely will do it better than anyone.


Joshua Kreitzer is the founder and CEO of Channel Bakers, considered the first ever Amazon advertising-focused agency. In just four years the agency has grown to more than 100 employees across five offices globally, and directly contributed to more than $1 billion in sales on the Amazon platform.


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