Amazon, the e-commerce giant, has the potential to “fulfill a promise that traditional television never could” if it decides to ramp up its video advertising endeavours, according to a paper in the Journal of Advertising Research (JAR).

“The real promise of Amazon Advertising is when video is introduced into the equation,” Andrew Lipsman, a principal analyst at research firm eMarketer, wrote in How Amazon will revolutionize the future of television advertising.

“In harnessing the power of video advertising at scale and closed-loop measurement, Amazon will fulfill a promise that traditional television never could.”

Elaborating on this theme, Lipsman suggested that Amazon’s main assets in this area – like Prime Video, the gaming platform Twitch, and IMDb, the film and TV database – are currently not set up in an optimal way to draw in TV adspend.

“Its existing video assets are fragmented and minimally advertising supported, so it is easy to overlook the enormous opportunity,” he stated.

Amazon, however, has acquired the rights to broadcast some games from the National Football League (NFL) and the UK’s Premier League, launched an ad-supported content stream under IMDb’s Freedive platform, and could use Fire TV as an over-the-top advertising platform. Its ad capabilities are growing rapidly, too.

In imagining the future of television advertising, Lipsman proposed that Amazon’s combination of consumer data, advertising solutions, hardware, software and physical product delivery could be a uniquely potent marketing option.

As a case in point, he pointed to the organisation’s launch of a targeted sampling program earlier this year. Unlike traditional in-store or on-street efforts, the company will know exactly who receives a sample and how likely they are to respond.

One hypothetical future for Amazon in the TV ad space could thus involve a consumer watching an NFL game on Amazon Prime, seeing an ad for a dog food line that is different than their current brand, and receiving a prompt to order it with the promise of next-day delivery.

When it arrives, the package could also contain samples of complementary products from the same brand, which then feature in more targeted ads during another NFL game on their Fire TV.

Using this approach, advertisers could get huge reach that is targeted to relevant households – alongside fueling awareness, product trial, repeat purchases and subscriptions, and even stealing customers from rival brands.

“From the standpoint of the viewer, the user experience is intuitive, relevant, and minimally disruptive. It provides a balanced value exchange in terms of attention and utility to the consumer,” Lipsman said. 

Sourced from Journal of Advertising Research; additional content by WARC staff