Member Exclusive   //   April 11, 2024

Amazon Briefing: Amazon is selling brands on programmatic podcast ads

This is the latest installment of the Amazon Briefing, a weekly Modern Retail+ column about the ever-changing Amazon ecosystem. More from the series →

Amazon’s growing programmatic ambitions now include podcast ads.

In an update to its DSP made earlier this year, Amazon is now selling self-service ad spots in podcast episodes. The offering was first offered in the U.K. last year, but has now been rolled out to the United States. It’s part of Amazon’s ever-growing list of new inventory it’s selling to advertisers to prove itself as more than just a retail media network that sells product placement ads that lead to direct conversion.

According to a pitch deck sent to advertisers viewed by Modern Retail, Amazon said the new offering lets brands deploy commercials that are “dynamically-inserted into ad breaks across ad-supported supply.” The deck touted a few Amazon-owned audio services and podcast networks, including Amazon Music, Wondery and Art19. Already, sources said, they’re beginning to see audio ads show up on shows that run through these programs.

“I think it’s a great opportunity to use programmatic,” said Liran Hirschkorn, CEO and founder of Incrementum Digital. “You can scale ads instead of going to a particular podcast.”

Over the last few years, Amazon has been adding inventory intended to have brands use it in more middle and top-of-funnel advertising campaigns. Video and audio have been core to these updates. Amazon has been pitching brands to product spots that would be seen on platforms like Amazon Prime Video and Twitch.

Specifically, Amazon has been touting the lower barrier to entry these programs require compared to more analog programs like linear TV. On Amazon Prime Video, for example, Amazon has let brands spend as little as $15,000 for a TV placement — and even helps the companies produce the commercials via its Creative Studio.

But TV isn’t Amazon’s only ambition. Amazon has also been selling ad placements on its owned audio services like Alexa. And now, the company is expanding it beyond the products it owns to services that have shows distributed on other audio platforms, like Apple Podcasts and Spotify. And, like Amazon’s TV offerings, the company is also offering creative support from its Creative Studio team to help produce the content.

The major competitive advantage Amazon touts is its ability for brands to be more targeted in these campaigns. In the pitch deck, Amazon tells advertisers they would be able to reach specific audiences by either the genre/category of the podcast or listener geography.

This is what Hirschkorn finds specifically useful about the podcast addition. “We’ve had brands doing radio ads for probably 100 years,” he said. “But it’s not as targeted or programmatic [as other advertising offerings].”

Some of the most popular podcasts are produced by or affiliated with Amazon-owned properties. Hirschkorn pointed to business series like “How I Built This” — which has a licensing deal with Wondery — and “Business Wars,” both of which have high listenership and are likely big draws for companies looking for B-to-B audiences.

Additionally, as is the case with all of Amazon’s other DSP offerings, the company offers brands ways to track performance with metrics like branded search lift and overall brand impressions.

Since the program is so new, many brands and agencies Modern Retail spoke with said they have yet to test it out. And there are still a lot of questions surrounding it. “I do think there’s an opportunity for general brand awareness,” said Ryan Flannagan, CEO of Nuanced Media. “But tracking is a concern — and the limited targeting.”

Specifically, it’s unclear how Amazon can measure engagement when a podcast program is played on a non-Amazon property like Spotify. “If you’re doing ads through Alexa, you can see someone say ‘Alexa, buy this product,'” said Flannagan. “But how do you close the loop with this?”

The answer, most likely, is old-school podcasting tactics. According to Hirschkorn, while Amazon will provide some metrics via its DSP console, brands will likely still need to include bespoke links or coupon codes to try and track campaign success.

For now, multiple sources said that they are still waiting before putting significant ad dollars behind this podcast program. With so much new inventory on different media, it’s hard to keep up — or figure out which ones are worthy of throwing real ad dollars behind.

“Everyone tends to rush to the newest best thing,” said Flannagan. “We’re a little more conservative with our advertising… It’s about doing the foundation side a bit better then expand out when you have proven metrics.”

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