E-commerce platforms have emerged as a key advertising channel for brands to reach their consumers. Amazon is one of the key beneficiaries of the boom in ad spends on e-commerce platforms. In FY21, Amazon Seller Services' revenue from the sale of advertising services jumped to Rs 2554.2 crore from Rs 1637 crore in FY20. Amazon Advertising Head Girish Prabhu spoke to e4m on the growth of e-commerce advertising in India and the role that Amazon is playing to drive its adoption among brands.
We have a lot of merchants, sellers and brands....everybody is selling online. When we thought about advertising, our idea was how do we bring the message of these brands and sellers who know a lot about their products. The knowledge that sellers and brands have surpasses pretty much anything that anyone else might know. So the question we asked ourselves was how do we deliver those messages to customers in a meaningful way where it's relevant to their shopping journey on Amazon? So that was the idea of Amazon Ads. We have sponsored products that are intent-driven. So if you are searching for products we will recommend items that are sponsored as well as organic. So our advertising is intended to make it easy to find, discover and buy on Amazon with inputs from the makers of those products.
E-commerce has emerged as the first port of call for many consumers when it comes to buying products. How important is it for brands to have a dedicated advertising strategy for e-commerce platforms?
It's already happening. We see that brands have online as the biggest channel and advertising is a key partner in that journey. We will continue to invest in building newer products that help brands to reach their audiences in a way that meaningfully resonates with them.
Is e-commerce advertising just for performance marketing or is it also used for brand building?
It's both, and what we are learning through our advertising products is that there's intent-driven and then there is behavioural. They all go back to the same person. What we are seeing is this whole funnel view of advertising that has traditionally evolved. Our products are meant to be objective-driven.
Being an AVOD platform, how does amazon mini TV complement the Amazon Ads business?
If you look at it globally, video advertising is an established model for us. In the US, we have products like Freevee and FireTV that are used by customers on a daily basis. Our biggest excitement around video is that video as a format is highly engaging and our brands and advertising partners can bring those experiences much more meaningfully to our customers. So yes, video is a key part of brand engagement and mini TV is a great example of that. We want to bring deeper engagements with brands that go beyond showing media. Most of our shows are going to be original productions so that gives us an opportunity to bring a lot of meaningful opportunities.
What kind of advertising properties do you have on the platform?
There are many kinds of selling models in advertising. For us, the important part is to get the right message to the right customers and Amazon mini TV will be one of those channels. The packaging part is really dependent on what the brands and our advertising customers want. Video gives us much more meaningful experiences.
A lot of brands that engage with us on Amazon are already active on amazon.in and the mobile shopping app. We don't look at it property by property because that's very difficult to do. We look at it from the point of view of objectives that brands have. A brand has certain objectives and messages for its products. For us, it is about the meaningful ways in which those messages get delivered to the consumers. mini TV could be one of them and our website is another one. There are various other mechanisms that we adopt to bring the right message. For us, it is about the objective.
What kind of hand-holding does Amazon Ads provide to clients?
We need to provide the technology and the capability to our customers. A lot of things that you see on self-service and also the managed service are towards providing the right capabilities so that our customers can make the right decision and that has been our tenet for all our advertising products. We want to make it easy. We want to make sure that brands can do what they want with minimal effort. That said, we also offer a combination of self-service and managed service to make sure that we are helping along the way to get the right message to the right customers.
Which product categories use Amazon Ads more frequently?
Every category has very active brands that are built for that category. We see the same behaviour across categories and our engagement is tailored to the objectives. If you look at fashion as a category, we tailor the ad experience to fashion objectives. If you look at books as a category, we tailor it differently. We work with the brands, we work with the sellers, and we tailor the approach.
How are brands using Amazon Ads to meet their business objectives?
We offer full-funnel solutions. That's our objective with the brands. It is not about any particular portion of the funnel. Our experience starts with the upper funnel, mid-funnel, and lower funnel engagement. That is the holistic experience for brands because different objectives are at the different stages of the funnel. If you see our sponsored products that is what we call a lower funnel performance which is intent-driven and we cater to the intent in a meaningful way. The upper funnel is where the brands are looking at 'here are the customers who will absolutely love my brand and will love the experience and I want to reach them'. We tailor our products to the full funnel experience and it's a holistic experience for brands as well.
Within the digital advertising ecosystem, how important is e-commerce as an advertising platform for brands?
The challenge that we are helping to solve is there is a lot of selection with millions of products. How do we bring meaningful experiences to our customers? That's where e-commerce advertising becomes important. Brands have certain messages and we take that message as an input to make discovery better. That input is what helps the brands and the sellers reach the right audience. We bring our organic understanding, and inputs from brands together to drive e-commerce. The big shift that we have seen is that brands are thinking about e-commerce as a channel that is not just important for sales but also important in getting to the right customers with the right message. It's a very big channel and digital is the fastest growing channel.