Concepts
Ads on Prime Video: Guide for Amazon Sellers
Feb 19, 2024
by
Neha Bhuchar
Amazon has started showing ads on Prime Video, also known as Amazon Prime Video ads, a move announced in late 2022 that is now in effect. Ads on Amazon Prime are available for eligible brands, sellers, vendors, and agencies. Businesses can buy Prime Video ads whether or not they sell products on Amazon. Ads in Prime Video content have been introduced in the U.S., U.K., Germany, Austria, Canada, France, Italy, Spain, and Mexico, and they will expand to Australia later in 2024.
Prime Video ads run on Amazon Originals and licensed third-party content included with a Prime membership. The ad experience includes both pre- and mid-roll ad breaks; some titles feature only pre-roll ad breaks.
These Prime Video ads are part of Amazon’s broader strategy to monetize content without altering subscription pricing. That said, Customers in the US, American Samoa, Puerto Rico, Isle of Man, the Netherlands, Mariana Islands, Belgium, Luxembourg, the US Virgin Islands, Guam, Portugal, the Republic of Ireland, or the Channel Islands who want to disable ads on Prime Video can upgrade to the ad-free version at an extra charge (e.g., $2.99/month for US customers). The launch plan, pricing, and further details for other countries are not yet clear.
In this article, we’ll discuss Amazon Prime Video advertising, the challenges sellers or advertisers might face, and strategies to launch video ads successfully.
Why Is Amazon Launching Ads on Prime Video & Another Subscription Tier?
Amazon wants to keep Prime a total “no-brainer”. You get Prime Video plus fast, free shipping on some 740 billion products, 24/7 support, exclusive sale events, and more. But let’s be real: the quantity of content (movies, series, originals) Amazon is cranking out isn’t cheap, and Prime Video has turned into a bit of a money pit.
So instead of hiking subscription prices, Amazon rolled out two tiers: one where users have to watch Prime Video with ads and one where they watch Prime Video ad free. It’s not exactly groundbreaking; Netflix, Disney+, HBO, and the like have been doing ad-supported plans for ages.
And the numbers back it up: the global AVOD (advertising-based video on demand) market is already at US$ 40.12 billion in 2024, growing at a 14.2% CAGR, and is set to hit $150.80 billion by 2034. Can you imagine? A few prime video ads here and there probably won’t scare off cord-cutters or Gen Z, who don’t bat an eye at commercials during their binge sessions.
With Amazon Prime Video ads, Amazon can pull in extra revenue from subscribers and sellers alike, and even upsell to Prime Video ad free customers. Will some customers churn over “too many ads”? Maybe. But since ad-supported streaming is too hackneyed to be surprising, overall watch time should stay the same.
How Will Prime Video Ads Be Different From Linear TV Ads?
There will be more limited advertisements on Prime Video than on Linear TV, which is around 4 minutes of ads per hour. However, there’s no specific information regarding ad duration or frequency. Also, Amazon will use tech to ensure limited and unintrusive advertisements. According to our research, here are a few ways of showing Amazon Prime Video ads to customers:
Display ads on the video page
These are the most intrusive type. Although they don’t disrupt the video-watching experience, they appear in the sidebar, below the video, or in designated ad spaces while the video plays. These ads take the customer straight to the product detail page of the advertised product.
Video ads within a video
Video ads are identified within a video using Cue Points. You can locate cue points with a red pointer on the video scrubber, telling you an ad is coming up.
In free video services, these scrubbers are automatically incorporated, which disrupts the watching experience. But, with Amazon’s high-quality Prime Video service, these cue points will most likely be incorporated to cause minimum disruption to video viewing, i.e., timed according to scene changes.
Placement ads
These are the least disruptive ad types. They are placed within the video on walls and objects used in the video, such as cups, standees, hoardings, etc.
Here’s an example:
Imagine if Game of Thrones still actually had a cup. Now, the cup is a dead space. Amazon can use this space to place an ad. Not only that, you can also put different ads for different customer segments.
Challenges for Sellers to Launch Prime Video Ads
Ads on Prime Video might be great for Amazon on the revenue front, but it comes with challenges for both sellers and Amazon. Here are a few of those:
Compliance with ad policies
For those who set up sponsored brand ads on Amazon PPC, compliance is crucial. Amazon has strict policies regarding what can be shown to customers, the language used in ads, and the products that can be advertised. Since there are several policies to comply with, sellers often face a high rejection rate of Amazon Prime Video ads.
Tips to overcome this challenge:
Review Amazon’s advertising guidelines, keep yourself updated, and ensure all ads meet the required standards before submission.
High cost of ads
Sponsored TV ads are expensive to run, not only because of the higher cost of placements but also because they include a creative aspect. Prime video ads will demand the highest quality (4K), which increases the cost of advertising on Amazon.
Tips to overcome this challenge:
Allocate a specific budget for your Prime Video ads. Next, monitor your ad performance closely to ensure higher returns.
Repurpose existing assets and invest in high-quality images only when necessary to reduce overall costs.
Understanding user behavior
Sellers might struggle to understand how Amazon Prime users interact with video ads as opposed to traditional ads. It is challenging for sellers to identify high-engagement moments, viewer preferences and interests, and demographics.
Tips to overcome this challenge:
Leverage Amazon Marketing Cloud to analyze user behavior, track engagement data, and adjust your ad strategies accordingly.
Perform A/B testing on ad creatives and ad placements to find out what works best for your brand.
Now that you’re aware of the possible challenges in Amazon ads on Prime Video, let’s discuss the top strategies to help you earn higher revenue through Amazon Video ads.
Top 3 Strategies for Increasing Revenue With Amazon Prime Video Ads
Whether you want to reach pet lovers, fashionistas, auto enthusiasts, or other audiences across genres and interests, Prime Video ads help your brand connect with relevant audiences using Amazon’s first-party signals and tools. Amazon ads offers ad-tech solutions that simplify planning, activation, and ongoing campaign management.
Targeting the right audience, building personas, and customizing ads to demographics is a basic strategy that sellers follow to achieve success in their ad campaigns. But there are a few more strategies that can help you boost your ad returns.
Optimize ad placement
Once you find the right placement for your ads on Prime Video, half the battle is won. You can select pre-roll (before content) placement, such as promotional trailers appearing before a TV show/movie starts, mid-roll (during natural breaks), post-roll (after the content), and display ads that appear alongside the video. Choosing a strategic placement based on your target audience’s viewing patterns ensures the ads are less disruptive and drive higher ad engagement and revenue.
Here’s how you can optimize ad placements:
Experiment with different ad placements. Conduct A/B tests to see which ad version performs better. Also, note the ad timing and how it affects views.
Use pause ads. Pause ads are the latest ad format where you air an ad when the viewer pauses the movie or Amazon original content they’re watching. This ad format has high visibility and is the least intrusive.
Leverage analytics. Monitor ad performances and track critical ad metrics to refine your strategy based on ad performance.
Integrate Prime ads with other Amazon solutions
Combine Amazon ads on Prime Video with other solutions, including Amazon campaigns like Sponsored Products and Sponsored Brands. This will help you boost your reach and improve brand recognition.
Here’s how you can do it:
Create bespoke Amazon ads. Design custom ads based on customer segments and demographics, and create different customer journeys that lead to the same outcome: conversion.
Build a consistent brand experience. Maintain consistency across all ad formats—from USPs to brand color schemes, discounts, and deadlines.
Create Freevee-supported ads. Amazon’s Freevee is a free, ad-supported streaming service. Ensure that your Prime Video ads run with Freevee so your ads can drive more traffic to your brand’s store during live events.
First- and third-party measurement: Use Amazon Brand Lift or trusted partners (Nielsen, Lucid, Innovid, Kantar, etc.) to track reach, frequency, brand lift, and in-app conversions.
Amazon Marketing Cloud: Fine-tune your strategy by analyzing data points, from media-mix breakdowns and in-depth audience profiles to customer journey mapping, custom attribution models, and cross-channel performance.
Run seasonal and event-based ad campaigns
Make the most of major events like Prime Day and seasonal peak trends like Black Friday and Cyber Monday. This helps you increase your brand’s visibility and drive more sales. We have a detailed article written on how you can use the Amazon Marketing Cloud to improve Amazon sales on Black Friday.
Here are a few tactics:
Offer exclusive discounts. Prioritize your Prime members during events and seasonal peak times like Christmas or Black Friday to attract more customers and boost sales.
Limit discount periods. Offer limited-time discounts and free delivery, or highlight seasonal products in your video ads to boost engagement.
Accessing Prime Video Ads and Buying Options
You can run Prime Video ads through Amazon DSP in two ways:
Managed-Service: Fill out the Amazon Ads form to be paired with a dedicated strategist and launch your campaign.
Self-Service: After registering, follow these steps:
Find Your Deals
Go to Inventory Hub’s Discover section and search “Prime Video.”
Select the specific Prime Video deal you want to target.
Create an Order
Start a new Prime Video order.
Set your objective to “Awareness” and pick KPIs like Video Completion Rate, Cost Per Completed View, or Reach.
Build a Line Item
Choose Line Type: Video.
Assign one product category/subcategory that best fits your campaign.
Attach Your Prime Video Deal
In the inventory targeting panel, click Change beside Deals, search for your chosen Prime Video deal, add it, and save.
Refine Targeting Constraints
Since deals have limited supply, consider loosening frequency caps, block/allow lists, or other restrictions to maximize delivery.
Set Bid Guidelines
Enter your fixed CPM rate for both the base bid and max average CPM.
Review any additional audience fees under delivery fees.
Launch Your Campaign
Double-check your settings and go live.
Successful Case Studies of Using Prime Video Ads
SharkNinja
SharkNinja ran Prime Video ads during high-engagement programming in the U.K., integrating these with its broader DSP campaigns. Viewers exposed to the ads were 20% more likely to add items to their carts, 20% more likely to convert within 10 days, and 40% more likely to complete a purchase, demonstrating strong mid- and lower-funnel lift.
Omegor
Mid-sized consumer brand Omegor used ads on Prime Video targeting 35–44-year-olds, measured via a third-party brand-lift study. The campaign drove an 88% increase in brand recall, a 15% uplift in purchase intent, and overall brand favorability rose by 16.8% with ad recall up 11.4% across all households.
Conclusion
Amazon has so far not disclosed any guidelines for Prime Video ads. We will learn as we go. However, the potential in terms of reach and impact is immense. It will help brands reach targeted and engaged audiences.
We will talk more about Prime Video ads in the future as we get more clarity from Amazon. Meanwhile, if you want to learn more about Amazon ads and how to automate them, you can contact us here.
About atom11
atom11 is a retail-aware Amazon PPC software that helps you get the best ROI for your ad spends on Amazon. It uses real-time retail signals like inventory levels, PPC cannibalization, and competition to provide actionable insights into your advertising strategies.
FAQs
Why has Amazon decided to introduce ads on Prime Video?
Amazon has introduced ads on Prime Video to offer a more diversified business model, allowing for additional revenue streams. This move can support the creation of more high-quality content and potentially keep subscription costs competitive.
Will all Prime Video content have ads?
Not necessarily. The introduction of Amazon Prime Video ads may vary by content type, with some shows or movies remaining ad-free, especially those under the Prime exclusive or original categories. Details on which content will have ads should be outlined in Amazon's official communication.
How do I get rid of ads on Amazon Prime Video?
Select Prime under the settings tab and choose “Go Ad Free”. This subscription lets you stream your favorite shows without ads. However, this is a paid subscription you must opt for to get rid of ads.
Is Amazon launching ads on its Prime Video service?
Yes, Amazon introduced Prime Video ads in January 2024, offering sellers a marketing opportunity to advertise their products across Amazon’s premium content. This will help sellers increase their brand recognition and sales.
Does Amazon Prime Video play ads?
Amazon Prime has limited ads during streaming. However, if you want to go ad-free, you must opt for an ad-free subscription.
What impact do Prime video ads have on Amazon sales for a seller?
Prime videos ads are bringing about a positive impact on sales. Independent researcher GuptaMedia evaluated how Amazon Prime Video ads impacted a retailer’s Sponsored Ads and new-to-brand sales. They found a 5× increase in Sponsored Ads effectiveness post-exposure, with over 50% of resulting sales coming from new-to-brand customers. Exposed viewers also showed measurable gains in awareness, favorability, and purchase intent beyond standard CTV metrics.
