By Alexandra Bruell
Advertisers who purchased spots on Amazon's NFL telecasts are
sizing up the platform's potential, and determining how best to
exploit it.
It's an important test for Amazon as it ventures into live
sports and tries to become a digital advertising powerhouse.
For some, the appeal is Amazon's promise of "attribution," the
idea that the company can show that ads led to an increase in brand
awareness or online store sales, including on Amazon.com. Marketers
crave that data and have gotten uneven results in television. For
others, the big draw is the affluent audience -- NFL games can only
be viewed by subscribers to Amazon's $99-a-year Prime service.
"It's an opportunity to partner with Amazon and to understand,
over the course of the season, Amazon consumers, NFL content, and
how they may or may not interact within Amazon's core platform of
e-commerce," said Tom McGovern, president of Optimum Sports, a
sports media and marketing agency owned by ad giant Omnicom.
Sling TV, which sells an online package of cable TV channels and
sees potential overlap with Amazon's streaming audience, was among
the advertisers that bought an Amazon NFL ad package. Other
advertisers include Showtime, Gillette, Pepsi and Hyundai.
"Part of the incentive is that these Amazon Prime users are
affluent; they're folks that purchase things online, and we think
and we're pretty sure that they're also more likely to watch
streaming," said Warren Schlichting, executive vice president of
marketing, programming and media sales at Sling TV and parent
company Dish.
Amazon sought $2.8 million for a package that included inventory
in each of its Thursday night games, as well as other ad inventory
across Amazon's platform. There were skeptics among advertisers and
not everyone went all in: some advertisers paid around $1 million
less than the original asking price, according to people familiar
with the deals.
Amazon has been using video as the tip of the spear as it tries
to become a bigger player in digital advertising. The online retail
giant generated $1.1 billion in U.S. digital ad revenue in 2016, a
small sum compared to Google's $29.4 billion and Facebook's $12.4
billion, according to eMarketer. But the e-commerce giant is viewed
on Madison Avenue as an emerging rival to the so-called "duopoly,"
due to its powerful data and deep pockets.
"We're very happy with advertiser response and are sold out,"
said an Amazon spokeswoman in a statement regarding its NFL
streaming effort. "Our focus is now on execution and, with our
advertisers, learning from the results we see throughout the
season."
Amazon paid $50 million for the rights to stream 10 Thursday
night NFL games, alongside television broadcasters CBS and NBC,
which are splitting the season schedule. Amazon has access to 22
spots per game, including pre-, post- and in-game ads -- inventory
that on traditional TV goes to local broadcast stations.
Some ad buyers were skeptical about Amazon's ability to attract
a big NFL audience, describing the buy as an "experiment."
After its first game on September 28th, Amazon said that the
average worldwide audience watching Thursday Night Football on
Prime for at least thirty seconds was 372,000. In the second game
Amazon aired, the average audience grew to 391,000.
By comparison, CBS and NFL Network's television coverage of the
two games averaged about 15 million viewers, according to figures
from CBS.
Mr. McGovern of Optimum Sports said "none of this is about mass
reach," but rather Amazon's audience data prowess.
Some advertisers rebuffed Amazon's ad packages, largely due to
the requirement to buy non-NFL Amazon ad inventory such as display
and video ads on Fire TV, Amazon.com and Amazon Prime's TV
shows.
"They're packaging everything and the kitchen sink," said one ad
buyer, describing the package as an "Amazon partnership opportunity
that included NFL."
In some cases, media buyers that didn't have clients that sell
products on Amazon were also uninterested, since the Amazon data
and research promised as part of the ad deal would be less valuable
to them.
An Amazon spokeswoman said in a statement, "We don't share
pricing or package details as a matter of policy -- but can tell
you that we offered a range of options at various price points
depending on advertiser objectives, which may include additional
Amazon media placements."
Amazon is so far drawing a larger audience than last year's
Thursday night streaming partner, Twitter, which averaged 270,333
viewers throughout the 2016-17 NFL season. And there are
indications people are watching Amazon's games longer: viewers
watched its first game for an average of 55 minutes, compared to 22
minutes for Twitter's first contest.
One ad buyer said Amazon NFL spots are more costly than TV ads
on a cost-per-thousand-impression basis (a common industry metric),
even though total spend on TV ads is greater -- a reflection of the
premium for the Prime audience.
As part of the deal, Amazon discussed delivering custom research
for advertisers that could show, for example, how users reacted to
an ad on Amazon.com, including whether they made actual purchases
on the e-commerce site. So far, many advertisers have yet to
receive those reports.
Buyers aren't expecting to see results in the short term.
"This is about a season-long understanding of how consumers
engage in the content and in the broader platform," said Mr.
McGovern.
(END) Dow Jones Newswires
October 12, 2017 14:28 ET (18:28 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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