Amazon Is Testing Audio Ads
Back in April Amazon announced plans to launch an ad-supported tier of their music streaming service to compete with the likes of Pandora, Spotify, etc.. Now we’re starting to hear reports of a quiet audio ad test Amazon is conducting with a handful of brands.
The beta project goes something like this. Brands give Amazon a :15 or :30 piece of audio creative to run, and in return receive a guaranteed million ad impressions for free. Understandably, Amazon is dealing with some bumps in the road as they test audio ad insertion. According to one agency exec who participated in the beta, “The test wasn’t hugely successful. Amazon hasn’t quite figured out how to insert ads in a way that makes sense and they haven’t thought about usability for the brands.”
Beyond just the testing phase, let’s think about how a full scale audio ad platform on Amazon Music could impact streaming’s competitive landscape. One on hand Amazon would be a formidable opponent because of the organic audio consumption happening on the 100M+ Echo devices which are now is use.
On the other hand Amazon’s audio ads would have limits. Since they wouldn’t serve ads to their Prime or Music Unlimited subscribers, the scale would be limited to Echo owners who are listening for free because Amazon Music is the default streaming service played on their smartspeakers. There’s not much visibility on the scale of this audience compared to their subscriber base. In addition, Amazon would have relatively little data on these listeners beyond their Amazon device registration (so no age, gender, MAIDs, etc.).
Bottom line . . . Amazon has a long way to go to develop a compelling, scalable audio ad product. But given the level Amazon plays at in every other industry they touch, it’s safe to assume they’ll figure it out.