Amazon is a brand advertiser as well as an advertising platform. Both fuelled by a data factory that is mainly funded by its client brands and end customers. A pretty neat trick you have to admit.
Amazon is data. Amazon advertising is a reflection of data science meets human creativity. The emotive Christmas ad, created by agency ‘Lucky generals’ is cute, maybe not be quite as fun as last year’s version of the same idea. But it works on pulling the heart strings. The rational product ads and offers, created in-house, also work. but not as art, but as Frighteningly efficient, laser targeted messengering.
It has been well documented that advertising is going through fundamental changes and brand owners need to clearly take stock of how they spend marketing budgets. Amazon have just done things on a much bigger scale and much faster than most brands are able.
Amazon are by a number of markers the epitome of the new age of advertising. A heady mix of magic and logic. The magic comes in the form of their brand advertising agency Lucky Generals who have made this year’s Christmas TV spot, featuring singing boxes to the tune of the Jacksons ‘Can you feel it’ The logic? Oh, there is a whole ton of that. First, they have invested heavily in an in-house creative facility called D1 that produces all of their product and tactical advertising. Secondly and way more intriguing is what Amazon are doing with their customer behaviour insights. Amazon is after all a unique beast, a retailer who is also the country’s third largest advertising platform who is also a major advertiser in its own right. Data science is completely at the heart of this. Proven in the first week of December when the brand briefly over took Microsoft and Apple to becomes the world’s most valuable.
Amazon do still need to persuade us about its expanding service. For that they need ads. Their voice assistant Alexa is a very good example. For the last year it’s been the gift of choice, selling upwards of 50+ million devices worldwide. But and it’s a massive but so far, their advertising, especially that of its retail partners from grocery to fashion have failed to convince us to shop using the thing. Earlier this year a leaked report put the numbers of consumers buying via voice assistants at a little over 5%. To improve on this figure Amazon, need to change ingrained behaviours. Especially in the UK where our inherent reserved nature means that rambling down a shopping list, without saying ‘sorry’ about a gazillion is going to be really hard. It’s no wonder that the most any UK based Alexa gets to do is tell the time and pick from Spotify. To change such behaviours takes very bold creative ideas aligned to an equally bold media budget. So far Amazon have held back from such a move hoping its clients will use their own budgets to do that, as Ocado is currently doing
It is very insightful that while Amazon has potentially the most valuable data set of customer intentions of any retailer. They have invested heavily in the magic of longer-term brand building to complement shorter term rational messaging. Not so long-ago Amazon’s advertising was looked after by an American advertising legend Droga5, a well-established, hugely creative agency, who undoubtedly would have continued to produce eye catching ads. But Amazon took a bold step and appointed a relatively new UK agency Lucky Generals known for creative that really gets the emotive nature of culture. The recent IPA effectiveness study into advertising highlighted the importance for brand health of longer term emotive brand building messaging. This to play alongside shorter term tactical messenges of price and features. The temptation for so many brands is to only do the latter, hoping for an upswing before thinking about commissioning the former. Empirical evidence in the IPA report from 900+ case studies in over 70 categories across almost 20 years proves this to be a real folly.
But Amazon are not finished yet. Lessons from Alibaba’s real world experiments in Asia with retailer brands like Huma show that we are only just touching the edge of what seamless customer experiences could be. Amazon has many experiments currently running in real world retail and financial products to test these waters. You get the sense of a brand very much developing its next stage after successfully reformulating for mobile
There has been recent coverage of the potential of Amazon launching a free to air video streaming service. This could be massive for brands. While Amazon Prime remains ad free. An open access channel could be a gold mine of consumer intentions. Not only would you know who they are, past purchases etc. But once they have been exposed to an add you would be able to correlate future behaviours of brands brought, categories browsed etc. There isn’t another advertising platform that could offer that. But would many people be watching? Well it goes without saying Amazon has access to epic content, it just remains to be seen how far they will go in getting one.
