Amazon OTT Advertising: Can Streaming TV (STV) Ads Work for You?

Perpetua Marketing Team, January 16, 2023

Amazon OTT ads, now known as Streaming TV ads (STV), are a type of online video advertisement delivered to viewers through streaming TV and other online videos. Amazon STV ads let brands reach specific niche audiences based on what they’re watching, regardless of whether the content is streamed on a TV, desktop, or mobile device.

In this article, we’ll look into why Amazon created STV ads, how they work, and what their benefits are. But before we do that, let’s go a bit deeper into what STV ads are.

What are Streaming TV (STV, formerly Amazon OTT) ads?

Streaming TV (STV) ads play before and during content on streaming platforms. Similar to traditional television commercials, they cannot be skipped and they cannot be clicked. Streaming TV ads appear on IMDb TV, Fire TV, and 3rd party on-demand apps. Aside from utilizing popular online content Amazon STV ad targeting is more data-driven than traditional TV advertising, making it a powerful tool to connect with consumers further up the funnel.

Background: the development of STV advertising

James Bond, The New York Yankees, and the English Premier League. When Amazon makes big splashes in purchasing exclusive broadcasting rights for high-quality exclusive content, many will say, "They're doing this so we buy more paper towels."

That statement is based on the adage that a Prime subscriber spends 3.5x more on Amazon.com, and the idea that Prime Video makes the Prime subscription even more valuable for Amazon's bottom line. That was correct.

The success of the initial hits on Prime Video, like Transparent, did in fact reinforce the value of the Prime subscription, leading to more subscribers and increased GMV for Amazon's marketplace. Things have changed though. Amazon's ambitious plans for acquiring exclusive video content are not fueled by a desired increase in subscriptions, but instead represent the next growth vector for Amazon's rapidly growing advertising business.

The ability to purchase ads on Amazon video content (STV ads) is powered by the Amazon DSP. Initially, the Amazon DSP only allowed advertisers to programmatically purchase display ads on Amazon's owned inventory and 3rd party publishers. Over the past several years, STV capabilities have opened up for all advertisers. The means of purchasing STV ads are now similar to display: Advertisers create unique audiences via Amazon's rich, first-party shopping data.

Amazon's 1,500+ (and growing) highly-targeted audience segments are an extremely powerful way to reach highly-qualified audiences. Some audience examples would are: sports, outdoors enthusiasts, and new parents. Once an audience is created, advertisers can then use the Amazon ADSP to decide the type of content their video ads will be served on.

How does Amazon STV (formerly OTT) advertising work?

Advertisers can buy Amazon STV ads through the Amazon DSP (demand-side platform). You’re free to specify your target audience, giving streaming TV ads a huge advantage over traditional TV advertising, which is shown to all viewers of a particular program no matter what.

Moreover, Amazon STV ads are non-skippable, ensuring they’re viewed from start to finish. They’re also presented in a full-screen format so advertisers are free to experiment with better visuals and finer details. Think of them like traditional TV ads, but modified to fit streaming services.

Users are charged for their Amazon STV advertising based on impressions, unlike Sponsored Ad campaigns, which charge per click.

Where do STV videos appear?

Below is a quick outline of Amazon video properties that support STV ads.

• FireTV
• Prime Video
• IMDB TV
• Sports
• Twitch

What are the advantages of Amazon STV (formerly Amazon OTT) advertising?

Let’s get down to brass tacks: why choose Amazon STV (formerly Amazon OTT) advertising over other types of advertisements? Here are a few solid reasons to consider adding STV ads to your marketing budget.

Precision targeting

Perhaps the biggest advantage of Amazon STV advertising is getting to hone in on your specific audience. Because the Amazon DSP lets you filter who sees your ads, you can choose precisely the type of person likely to buy your products.

Amazon allows advertisers to choose their audience based on lifestyle, interests, shopping behavior, and more. You can even specify shoppers who have browsed certain products. This includes people who have viewed your product page but didn’t purchase, so if you strategize correctly, you can use Amazon STV advertising to increase your Amazon conversion rates.

On top of that, savvy marketers can cater different campaigns to different audiences simultaneously. For example, you can create separate video ads for young and old audiences, fine-tuning the language and imagery for each group to get the best reactions.

Streaming TV (STV) video ads see a large share of mid- to long-term purchases

A recent Perpetua study compared three different types of ads: STV, Amazon DSP ads (excluding STV), and Amazon Sponsored Products ads. We found that 70% of STV purchases occurred within 3-14 days after first ad interaction, followed by 33% for DSP purchases (excluding STV), and only 9% for Sponsored Products.

These results reflect that STV ads, and DSP ads more generally, are effective ways to drive awareness and build mid- to long-term demand.

Break into new markets

Amazon STV advertising reaches beyond the Amazon marketplace, including popular channels like IMDb TV and Twitch. This makes STV ads a great solution if you’re wondering how to drive external traffic to your Amazon listing.

Poach customers from competitors

One of the more interesting audience filters available via Amazon STV advertising lets you target shoppers who have viewed your competitors’ products, but have not purchased anything.

More cost-effective than traditional TV ads

Ironically, as the viewership of traditional TV declines, the cost of advertising rises. Based on the data, people will continue abandoning cable and satellite TV for streaming services, and it’s looking like traditional TV will never recover.

Is Amazon STV advertising (formerly Amazon OTT ads) right for you?

Making a streaming TV ad work for you involves expertise in various fields. For one thing, you need to understand videography and how to actually make a video that people like.

As a more efficient alternative, more and more Amazon sellers are enlisting managed services like Perpetua’s to help them set up Amazon Streaming TV ads. Learn more about how Perpetua’s DSP managed service can help you leverage STV ads here.

Amazon Streaming TV ads FAQ

Does Amazon do TV advertising?

Amazon does not offer ad placements that appear during traditional television content. It does offer ad placements in its streaming content, called Streaming TV ads (STV).

What are Streaming TV ads?

Amazon Streaming TV (STV) ads are commercials that play before and during online video content.

How does streaming advertising work?

The Amazon demand-side platform provides advertisers with access to Amazon STV ads.

How can I access Streaming TV ads and online video ads?

Amazon STV ads are available through the Amazon demand-side platform (DSP). If you access the Amazon DSP via a managed-service, inquire with your service provider.