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Abstract:Amazon is about to test more video ads, and agencies see this as a way to compete with Google as well as Facebook.
Amazon is expanding a test of video ads in search with its most prominent ad placement yet.The ads will appear in search results and feature six-second product videos, agency sources said.Agencies see the ads as a way to target people when they're in a shopping mode and as a direct shot at Google's ad business.Visit Business Insider's homepage for more stories.Amazon is about to test new video advertising units in what agencies said represents its most aggressive effort ever to compete with Google for brand ad dollars.The e-commerce giant is about to beta-test a video ad unit that appears in search results when users type in certain keywords, three agency sources told Business Insider.Advertisers previously had to go through an Amazon sales rep to buy video search ads; one agency source said clients had to commit to upwards of six figures to do so. But in the upcoming beta test, advertisers will be able to buy these video ads programmatically on a cost-per-click basis, sources with direct knowledge of the test said.That lowers the cost barrier to entry because there's no minimum spend, they said.Amazon has been slow to introduce ads so as not to turn off users. Some agency sources briefed by Amazon said the beta ads would appear at the top of search results, which they considered significant because the placement would be more prominent than in the past.“This one is going to be probably the most impactful with regard to driving sales and with traditional engagement metrics,” said one agency source, speaking anonymously. “You're front and center now.”Another source with knowledge of the beta test disputed that, saying said the ads would continue to appear below the fold, where they are now.As it grows its ad business, Amazon has been trying to promote the platform as a way for advertisers to build brand awareness, not just drive sales. That message has led to some confusion for advertisers who have said it's hard to know which kinds of advertisers Amazon is aiming at. Advertisers have also expressed sticker shock at the price of Amazon's video ads.But agencies briefed on the new video ad expressed excitement about trying it for clients, saying it was a powerful way for an established or new brands to get in front of people who are actively searching for products in the same category. The ads will autoplay and run for six seconds, agency sources said.Read more: 'It's in this weird middle ground:' Amazon has a new plan to win over big brands with video ads, but agencies aren't buying itNich Weinheimer, VP of commerce at Kenshoo, said Amazon has lagged Facebook and Instagram in ad products that target people who are considered to be in research mode. Amazon has traditionally known as a place to reach people when they're lower down the purchase funnel, close to buying.“It would not be surprising for Amazon to leverage the top of search placement of the Sponsored Brands real estate to test a richer brand engagement unit — something video does very well,” he said. “Video as an ad type is one of the fastest growing ad units on Facebook, so it stands to reason that Amazon would want to close the gap in their funnel and tap into this mid-funnel exposure opportunity.”Others saw the latest video ad move as a direct shot at Google, which is the other main starting point for online shoppers. Google for its part has been ramping up shopping features itself to enable people to buy straight from Google search results. Amazon has been ramping up its efforts to grow its ad business by taking share from Google and Facebook, but to be sure, it has a long way to go. According to eMarketer, Amazon had 4.1% of the US digital advertising pie in 2018, versus Facebook and Google, which together collected 57.7%.Google declined to comment.“More people are starting the search at Amazon, and Google is coming up with new ad products,” said Bruce Kiernan, commerce lead at Wavemaker. “Google's trying to get more lower-funnel as Amazon's going more upper-funnel.”
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