The Extended Ad Network is part of a greater plan to grow Amazon into a true marketing platform. The marketplace has long been at work behind the scenes to prepare to compete against the online advertising giants Google and Facebook. The Extended Ad Network is pushing these plans forward by introducing a wider reach for Amazon Sponsored Product Ads.
The Extended Ad Network
Early December 2017 was an exciting time for Amazon sellers. They actually got a rare glimpse into something that was still in the works at the retail giant. After a shaky start in the 3rd quarter, the Extended Ad Network beta program rolled out to a few sellers. The lucky invitees got to test the Extended Ad Network features for auto-targeted Sponsored Products ads campaigns.
Despite the leak, we don’t know how many sellers have been invited to test the option. There has been no announcement about when the Extended Ad Network feature will be rolled out to all sellers. Amazon has not yet released a set of guidelines or a list of options for using the Extended Ad Network. What we do know is that the Extended Ad Network is part of a larger vision decades in the making. Amazon has been preparing to build the marketplace as a true advertising platform. As such, we know that sellers should be brace for impact – in the positive sense of the word.
Previously, Sponsored Products ads had a limited reach through Amazon’s automatic targeting feature. The marketplace explains that the Extended Ad Network extends Sponsored Products capabilities. Sellers will be able to take advantage of this increased reach to target shoppers outside of the platform’s previously limited audience. The ability to target ads to customers visiting websites all over the internet is proof that Amazon advertising is clearly advancing.
Amazon is always blazing new paths with disruptive force. We expect the Extended Ad Network to present whole new way of doing online advertising. Google and Facebook have existed in harmony as they grew their platforms on more traditional advertising concepts. They have a huge edge over Amazon, but Amazon is not going to have to play catchup. The retail giant is poised not to take them on by storm but to displace the current trend by reinventing online advertising.
Packing a Punch
Always secretive, Amazon has given no clue as to what comprises its ad network, whether the current or this new Extended Ad Network. The few facts we have about Amazon, however, point to a system that will limit the targeting to products that will ultimately be sold on the marketplace. Amazon has collected a greater volume of data on selling, and in more detail, than Google or Facebook. This focused approach grants them a key advantage to blaze a niche path to the top.
Taking a closer look, it appears that the Extended Ad Network feature presents automatically targeted Sponsored Products ads to shoppers on mobile, desktop, and apps, apart from websites other than Amazon. This system brings a new and much larger audience of online shoppers straight to product detail pages. Although the targeting is automated, sellers will be allowed some degree of control. Targeting can be narrowed down based on page context and similar product views, for instance. After testing the feature, sellers who are not seeing good results – though we do not see how this could happen – can easily disable the Extended Ad Network feature by switching it off in Campaign Settings under the Campaign Manager.
It’s always difficult to have expectations about a feature that’s kept so close to the cuff. But this is how Amazon operates, and it has a lot to do with managing seller reactions. They don’t want anyone to get too excited about something new, but we think there’s really something here to get excited about. To summarize:
1. Traffic and Impressions
The first and most obvious effect of using the Extended Ad Network is a marked increase in Amazon product page visits. The extent of this depends on how much of the Extended Ad Network Amazon decides to open up to targeting. They are likely to take it slow at first. Amazon has been known to ease new things very carefully into play. It’s part of how they manage the customer experience and protect these most valuable relationships.
2. Ultra-Targeted Amazon Campaigns
Amazon holds an unfathomably massive store of data on shoppers. And it’s not even the sheer volume of that store that is so impressive. This data contains so many bits of highly personalized information and accurate details on behavior and product selections and projections about related possibilities. We can see how good Amazon already is at using that data on their marketplace. It’s a very lucrative operation. Now, we can also imagine how well they will be able to put it into play on the wider Web.
To truly understand the potential reach of the Extended Ad Network, we have to look at everything that Amazon has gotten its hands into. But that could take another 10,000 words, easily. Just for a taste, think about Kindle and Fire and Echo and Alexa and Cloud Video and Music. Imagine the possibilities for your ad popping up alongside content under the Amazon Group of Companies – i.e., Amazon Corporate LLC, Amazon Digital Services LLC, Amazon Media Group LLC, Amazon Services LLC, Amazon Web Services, Inc., and Audible, Inc., apart from Amazon.com, Inc. This scope offers a wide range of references in each of the specific content areas. Your ad could be first on Alexa’s lips or positioned beside an Amazon original series. You get the idea.
Now think about the opportunities that the Extended Ad Network offers you outside of Amazon. The marketplace has many connections outside its own directly branded products and services. There’s Amazon’s holdings, flexible of course, but easily over a hundred at any given time. Cross-marketing with these companies gives you an even broader opportunity for your Extended Ad Network campaigns to reach their audiences. These holdings are composed of companies in several industries:
- Data, Artificial Intelligence, Search Technology (e.g. Amazon search’s A9.com, Alexa’s Evi Tech and Amazon Robotics)
- Computing and Cloud Services (e.g. beyond Amazon Cloud Drive and Cloud Player to the AWS Cloud)
- Hardware (e.g. Annapurna Labs Kindle computer-server chips and Touchco touchscreen technology and future branded devices)
- Clothing and Accessories (e.g. Zappos, ShopBop, and Fabric.com)
- Financial Services (e.g. Bill Me Later, Amazon Payments and Amazon’s rewards-based Chase Bank credit card)
- Food and Beverages (e.g. Whole Foods, Amazon Fresh and Amazon Subscribe & Save)
- Media: Broadcast, Production, and Publishing (e.g. Audible, IMDb, Twitch.tv, AbeBooks, Double Helix Games, Box Office Mojo, Brilliance Audio, BookDepository, ComiXology, CreateSpace, and The Washington Post)
- Social Networks and Volume Deal Purchasing Sites (e.g. Goodreads, LivingSocial and Woot)
On the not-so-exciting side:
3. Advertising Costs
Sellers can expect low cost per click in the beginning due to low competition in the Extended Ad Network’s early stages. Amazon also promises to never go beyond set maximum default bids. The Extended Ad Network is only for automated campaigns, however. Sellers lack control, which can lead to higher ACoS. This is an assumption based on how these things usually go, but the real impact remains to be seen. It seems unlikely that Amazon would spend 20 years working on a plan just to roll out a feature that will not improve the marketplace experience.
Amazon’s Extended Ad Network invitation email states that there is no exclusion list, currently. This means that one side of the coin limits sellers’ ability to control where their ads will show up – for now. The other side, however, means that the Extended Ad Network could be fully open to Sponsored Products.
The question of control here seems to be a key essential to the success of this Extended Ad Network drive. Manual targeting may be offered in the future, when more controlled testing with automatic targeting is complete. Targeting control is expected to encourage more seller participation as fears of relevancy dissipate. More seller participation means a huge Amazon presence on the Net.
Amazon tends to be very quiet about its new releases, but it also tends to move fast. 2018 is going to be a real game-changer for Amazon and all sellers connected with the marketplace. If you haven’t yet been offered the chance to test the Extended Ad Network feature, use this time to prepare.
Optimize your listings and be ready with excellent product detail pages to test Extended Ad Network targeting on. If you haven’t used Sponsored Products much or aren’t even enrolled yet, get that done. Do Headline Search Ads, too. Competitors who are going to take advantage of the Extended Ad Network are going to be in a position to quickly crush you if you don’t catch up now. Learn these available features and learn to use them better. Run promos and more effort into customer satisfaction to build your brand. This also helps you to collect data that you can use for future campaigns and again to refine your targeting if and when manual targeting becomes available on the Extended Ad Network.
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