Amazon revealed new stats about its viewers to ad buyers to pitch Prime Video advertising, which will roll out early next year.
These ads will be added to shows and movies in the US, UK, Canada, and Germany in early 2023, then rolled out in France, Spain, Italy, Mexico, and Australia later that year. Prime Video users can opt out of advertising by paying $2.99 more per month.
Amazon expects the ad tier of Prime Video to reach more than 115 million people in the US each month, according to a briefing document sent by Amazon to ad buyers and viewed by Insider.
Amazon doesn’t break out subscriber numbers, but Insider Intelligence estimates that Prime Video has 157 million US subscribers — making it the third-largest US streaming platform behind YouTube and Netflix.
The document cites internal Amazon data revealing that 54% of Prime Video viewers are between 18 and 44 years old, and 40% of Prime Video households have children under 18 years old in the home. The stats suggest that advertisers will be able to target younger viewers with Prime Video ads.
Amazon is also pitching its shopping-heavy audience to advertisers. 84% of Prime Video households bought something on Amazon between May and June of this year, according to the document. And more than 25% of Prime Video households are likely to have an annual household income of more than $150,000, according to the document.
Amazon declined to comment about the metrics shared in the document.
Prime Video ads will appear in Originals content as well as licensed TV and movies, according to the document. Amazon also emphasized its original Prime Video programming including movies “Road House” starring Jake Gyllenhaal, “The Idea of You” starring Anne Hathaway, and TV series like “The Boys,” “Cross,” and “Mr. and Mrs. Smith.” The document said that availability of ads in shows is subject to Amazon’s approval.
Advertisers can also structure their Prime Video ad deals as premium sponsorships of content, guaranteed buys, and preferred deals, according to the doc. Guaranteed buys and preferred deals allow Amazon to negotiate big deals with advertisers and promise advertisers set pricing and audiences. However, marketers that want to advertise in Amazon’s “Thursday Night Football” games and its ad-supported streaming service Freevee will need to buy those campaigns separately.
Here is Amazon’s pitch deck:
Amazon’s big ad ambitions
Amazon has been beefing up its TV ad sales efforts to grow its $38 billion ad business beyond its core search advertising format. For example, Amazon is targeting big brands that don’t sell products on its platform like insurance and finance brands with its pitch around “Thursday Night Football” games.
Agencies are attracted by the possibility of being able to reach a big audience with Prime Video right out of the box, unlike Netflix and Disney+, which took a different approach of launching new, ad-supported tiers that took time to build an audience.
They also expect that their video ads will be able to be linked to product sales on the e-commerce platform, a feature Amazon has rolled out for “Thursday Night Football” ads.
“It’s a potent use case if you’re an endemic on Amazon,” said Jon Morgenstern, head of investment at VaynerMedia, referring to advertisers who sell products on Amazon. “It’s retail media meets OTT.”
Amazon has a couple of other potential advantages over Netflix. It has a mature ad sales team and video ad sales business. And while Amazon hasn’t shared pricing for Prime Video ads, advertisers expect them to be priced reasonably. In contrast, buyers criticized Netflix as being too aggressive with pricing its ads initially.
That said, Amazon is late adding Prime Video to the ad-supported streaming game, and advertisers already have many other choices of places to put their dollars. “We’re interested for sure,” one buyer said. “But it isn’t completely virgin territory.”
A big question for advertisers is also whether Amazon will require clients to buy ads directly from a salesperson or let them buy ads programmatically, which has become the industry standard. Netflix hasn’t made that option available yet.
They also want to know if Amazon will make any of its shows off-limits for ads and how many ads people will see per hour, aware that too many ads can turn off viewers. Amazon said it would have a lower ad load than traditional TV and other streamers.
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