Amazon Advertising Roadmap to 2023: How to divine the future using Google Ads
What does 2012 - 2015 have in common with 2020 - 2023?
What is coming to Amazon Advertising in 2021, 2022, and 2023?
Total Read Time: ~10 minutes.
A huge focus on driving adoption by agencies.
Lowering the barrier to entry for non-API users.
Big improvements to reporting within the interface including longer lookback windows, date range comparison and competitor insights.
Expansion of targeting/optimisation choices (devices, dayparting etc.).
Bulk editing in the interface to become available, possibly also scripts.
Good chance of fully automated bidding.
Minimal reliance on API for advanced capability.
While deliberating on what’s coming next for Amazon Advertising, and what capability is worth investing in for the future, I stumbled across a curious connection. On Amazon Advertising there has been a never-ending flurry of updates and changes. One very recent change stood out to me though. Google Ads-esque Manager Accounts.
I started my career in digital in Google Ads. By that time it was already advanced with a complex interface. When I transitioned to working on Amazon, it was like travelling in time. iPhone 11 versus Nokia 3310.
Admittedly it was refreshing to not have to worry about multiplicative bid modifiers on devices, regions, audiences, hours of the day, days of the week and the phases of the moon. They simply weren’t options.
While Amazon is very different, Google Ads gave me insight into what a well polished advertising revenue generating machine looks like. So when Amazon released their equivalent to a Google Ads MCC, it got my attention.
What struck me about Amazon Advertising when I started working on it was how unsuited it was to agencies.
Agencies (solvent ones) have multiple clients, and jumping between Amazon accounts was painful, as was switching between countries within an account. Google Ads has it’s bottlenecks, but switching between accounts is two clicks. On Amazon, it was click, click, scroll, click, click, click to get from one advertising account to the next. Reporting was clunky and there was no unified dashboard where you could easily glance over everything.
First world problems I know, but paid advertising monopolies are about as first world as it gets.
The advent of manager accounts suddenly makes managing multiple clients in multiple regions far less carpal tunnel-inducing.
It’s almost too obvious to point out that Amazon wants agencies to adopt their advertising platform. Of course they do. Agencies will go around pitching their platform for them. They are often incentivised to increase ad spend to increase fees. The other side of that self-interested coin is that agencies do allow businesses to spend larger amounts more effectively.
Agencies on board, Amazon will get more ad revenue, as well as attract and retain more advertisers. But manager accounts are just the tip of the iceberg.
Where I am going to get a little more into the roadmap is in the specific parallels between Google Ads and Amazon Advertising, in particular during their respective 7th, 8th, 9th and 10th years in existence.
In late 2019 I delivered a talk on Amazon Advertising at Search Advertising Show in Brighton. I made an off-hand comment that ‘there was no way that Amazon is not working on some hardcore machine learning driven bidding strategies’. For those who want to hold me to it, I predicted we’d see the first iterations in mid-2021.
They have so much data on people’s shopping habits that this seems like a no-brainer. It would be a dream for Amazon to be able to simplify campaign management to ‘enter budget’, ‘select products’ and ‘set desired ACoS’ and have it just work. That would basically be a money printer, especially considering they also get a 15% cut of every sale.
Google is quite close to achieving this with Smart Shopping Campaigns. Over time the performance of their bid automation has improved and by and large smart shopping is quite effective whilst having the bare minimum of controls.
But before smart shopping, there was a long period where Google kept putting more and more options in front of the advertiser. All of these options were great for skilled PPC-ers. Granularity was king, although it did turn us into control freaks.
Amazon has started down a similar path it seems with the addition of placement modifiers. I can’t imagine that dayparting is miles away. The same must surely go for devices, although this may be a little more complex considering there is both site and app traffic for mobile devices.
But why do Amazon have an interest in increasing the complexity of the platform, more specifically the interface?
It levels the playing field.
Growth in third party sales (seller central accounts) massively outstrips the growth Amazon sees from first party (vendor central accounts). Amazon’s percentage of sales coming from the top selling accounts is also declining as Amazon’s long tail of retailers grows. Basically, lots of small accounts selling a little is totalling up to be a lot.
Rather than increased complexity and features raising the barrier to entry, it lowers it. At the time of writing, more advanced controls like dayparting are only possible by using the API or a third party tool that uses the API. Both of which are expensive relative to the revenue of smaller retailers as well as agencies who need to absorb that cost, either in subscription fees or development.
The more an advertiser can get done without leaving the interface, whether that be to excel or to a 3P tool, the better it will be. Many marketing software providers aim to achieve the same, a complete management solution.
Many reports were previously only available by exporting to excel. If you weren’t well versed in pivoting they were tough to make use of. Even the search term report was only visible via .csv export. Not anymore, now the advertiser can view their search terms without leaving the interface. A seemingly insignificant step, but an important one.
There will always be room for third party tech, but it’s not in the interest of Amazon Advertising to rely solely on 3P tools to be usable. If Amazon wants to accelerate the adoption of paid ads, they need to make it as accessible as possible (and easier to spend money on).
We’ve already seen the introduction of placement modifiers, machine learning based bid adjustment and more control over ad creative, but what’s coming next?
I thought it might be interesting to see what Google Ads was doing when it was Amazon Advertising’s age. It was.
There are uncanny similarities between Google Ads and Amazon Advertising in the several years around age 10. Both experience a period of wider economic contraction (GFC and COVID-19 respectively). Both see similar advertising revenues.
The nature of changes and additions to the platforms in particular are very similar.
While yes, in the comparison above I am omitting developments such as Google’s 2009 launch of Shopping Ads and Amazon’s launch of product targeting in 2018, there is a striking similarity in the theme for both.
It centres around solidifying the value proposition of the platform as a way to reach and win customers. Improved bidding, more relevant targeting, insightful tracking, increased visibility and improved engagement. The odd one out is the update to the interface. Nice to have, but it doesn’t inherently make the platform a better acquisition channel.
Earlier in this piece I speculated that Amazon would seek to level the playing field by improving the interface. To make more optimisation and reporting functionality available to the everyday user without needing the API.
Where this gets more interesting is what came in the years following for Google Ads.
Google Ads 2012 - 2015
Auction Insights Report (competitor insights)
Bulk Edits (initially 2012, functionality expanded in 2014)
Device Bid Modifiers
Remarketing Audiences for Search Ads
Date range comparisons
Import metrics from Google Analytics
Cross-account management tools at MCC level
Data freshness improved at MCC level
Improvements to the interface enabling management at scale dominate this period for Google Ads, including some big ones like scripts, bulk edits, and device modifiers.
To those who might accuse me of cherry-picking updates to fit my roadmap, yes, Google made numerous updates and released a few new ad types as well in 2012 - 2015. I’m not suggesting that Amazon will work on the interface to the exclusion of all else in the coming few years, but the addition of optimisation and reporting features to the interface are an undeniable theme during the same period for Google Ads.
In summary, in the interest of driving rapid adoption and retention among merchants and especially agencies over the next 2 - 3 years, Amazon will have a distinct focus on making significant improvement to the interface, and expansion of the optimisation and reporting possible within. This will greatly reduce reliance on the API for more advanced capabilities, lowering the barrier to entry.
I expect this to include bulk editing in the interface, device modifiers, dayparting, longer lookback windows for reports, date range comparison, and fully automated bidding (at least the first iteration). It might include scripts, competitor insights reports, location targeting, and audience targeting for sponsored products/brands. All of this will dramatically change the landscape for advertisers, agencies, and the 3P tech providers tethered to the platform.
In counterargument, Amazon have a partner program for 3P software providers who use the API to make tools for advertisers, so they have at least a degree of interest in their long term development (they could just be doing a classic Amazon; letting others spend money building tools, wait and see what functionality is most popular, then add that to the interface). They also cite use of technology (their API) as one of the markers of a best-in-class Amazon agency. So it’s entirely possible that I’m completely wrong and Amazon will only tweak the occasional feature and simply let others build functionality. The more retailers there are using paid ads, the more compulsory they’ll become in order to stay competitive. Amazon could very well rely on this to drive growth in ad revenue, and everyone will just have to put up with a clunky interface.