1. What is Amazon Advertising?

Amazon Advertising refers to the suite of ad solutions brands and sellers can leverage both on and off Amazon’s platform. From driving product discovery to increasing brand awareness, Amazon’s ad offerings have grown rapidly in scope and sophistication over the past decade.

A Brief History of Amazon Advertising

2012: Amazon officially launched its advertising platform.
2014: Early-stage, basic tools started gaining traction among sellers.
2017: More advanced ad products were introduced, including Amazon Display Ads, Sponsored Products, and Video Ads.
2019: The platform matured and became a critical marketing channel for brands.

Why Amazon Advertising Matters

Digital advertising is growing fast, and Amazon’s share is expanding alongside it.
Consumer packaged goods (CPG) brands find Amazon advertising especially effective, though opportunities exist across various business types.
Ads on Amazon appear at the top of search results, making them a major driver of sales.
In 2020, roughly 30% of brands’ total revenue on Amazon came directly from advertising.

2. Types of Amazon Ads

Here’s a breakdown of the main Amazon ad formats and their use cases:

1. Sponsored Products

Promote individual products to appear in search results even if they’re not organically ranked.

2. Sponsored Brands

Promote your brand with logo, tagline, and multiple products.
Appears at the top of search results to increase brand visibility.

3. Sponsored Video

Video ads displayed mid or bottom of search results.
Highly effective for engaging customers visually.

4. Sponsored Display

Ads shown both on and off Amazon through Amazon’s display network.

5. Amazon DSP (Demand Side Platform)

Programmatic ad buying across Amazon’s ecosystem and beyond, including Firestick and TV apps.
Requires a significant ad investment to unlock its full potential.

6. Audio Ads

Voice ads delivered via Alexa-enabled devices.

7. Storefronts (Free)

Your brand’s dedicated mini-store on Amazon.
Ideal for brand storytelling and product discovery.

8. Posts (Free & Beta)

Social-style posts on Amazon featuring images, text, and products.
Think of it like Facebook posts, but within Amazon.

9. Amazon Live Video (Free)

Live streaming directly on Amazon to showcase products in real time.

Strategy Tip:

Brands should focus on Sponsored Products, Sponsored Brands, Sponsored Video, Storefronts, Posts, and Amazon Live.
Depending on business type, Sponsored Display, DSP, and Audio Ads may be effective as well.

3. The Current State and Future of Amazon Advertising

Current Landscape

Amazon advertising today is comparable to Google six years ago, still somewhat basic in interface and features.
Competition is fierce; brands often run ads at a loss just to maintain ranking.
Most ad spend goes to Sponsored Products and Sponsored Brands.

The Future of Amazon Ads

Key Trends:

More Control: Advertisers will gain more options to control who sees their ads, where they appear, and how campaigns are structured.
More Creativity: Beyond choosing products, brands will need visually compelling content, catchy copy, and engaging creatives.
More Interaction: Features like Amazon Live will facilitate real-time interaction between sellers and buyers.
More Traffic: Increased ad sophistication and reach will drive more traffic to products.

Looking Ahead:

Creativity and storytelling will become more central to campaigns.
Exploration-driven ad formats like Live and Posts will rise in importance.
Video content will dominate as a key engagement tool.
Creative ad copy and visually appealing Posts will be essential.
Opportunities will expand beyond consumer packaged goods to other business types.
The platform will become more precise and segmented, allowing advertisers to target audiences more effectively.
Amazon advertising is poised for exponential growth.

By 2024:

Amazon will serve as a robust outlet for brands beyond traditional CPG.
Its display network will grow exponentially.
Programmatic ad buying will become more sophisticated and granular.
Enhanced web retargeting options will be available.
Advanced audience segmentation will give advertisers greater precision and control.

Summary

Amazon advertising is no longer optional. It’s central to e-commerce growth. With multiple ad formats, growing creative opportunities, and increasingly sophisticated targeting options, brands that master Amazon advertising now will be well-positioned to capture significant market share in the coming years.