Ahead of Amazon’s Earnings call this week, Tinuiti has released The Amazon Ads Benchmark Report for Q4 2019. Using anonymized same-client samples derived from more than $400 million in Amazon ad spend under management, the report examines key trends in Amazon Advertising and explores where brands are investing on the platform.- including Amazon DSP, Sponsored Brands and Sponsored Products.
Tinuiti’s report reveals the continued growth of Amazon’s Demand-Side Platform (DSP). Amazon DSP spend grew 44% from Q3 to Q4, the largest quarter-over-quarter jump of 2019. New-to-brand share of purchases attributed to the DSP went up from 71% in Q3 to 78% in Q4, and holiday shoppers demonstrated more willingness to purchase from brands they haven’t bought from in the last twelve months than at other times of the year.
Amazon Ads Benchmark Report highlights
Amazon Demand-Side Platform (DSP)
- 69% of spend and 72% of purchases for the DSP were attributed to Amazon owned-and-operated properties in Q4 2019. Advertisers can only target Amazon properties through Amazon ad campaigns, as these placements are not available through other DSPs.
- 60% of Amazon DSP spend was attributed to campaigns focused on driving customer awareness and consideration. While purchase-focused campaigns accounted for nearly 75% of spend in Q1 2019, advertisers steadily shifted focus to more upper-funnel tactics throughout the year.
Amazon Sponsored Products and Sponsored Brands
Sponsored Brands spend growth accelerated from 19% in Q3 to 27% in Q4, driven by a 38% Y/Y increase in clicks. Sales grew even faster than spend at 43% for the quarter. The share of Sponsored Brands conversions attributed as new-to-brand grew from 58% in Q3 to 60% in Q4, as new-to-brand share picked up during the core weeks of the holiday shopping season.
- Amazon Sponsored Products ad spend increased 30% Y/Y in Q4, the same rate observed in Q3, as sales attributed to the format grew 21%. CPC growth steadily accelerated throughout 2019 as more advertisers continue to enter the space, and in Q4 grew 12% Y/Y.
- Sponsored Brands now account for 13% of Amazon search format spend, up from 12% in Q3. Amazon recently introduced video creative in Sponsored Brands, giving brands greater capacity to convey selling points and visuals to prospective customers.
- New Sponsored Brands inventory introduced in August 2018 significantly expanded the available inventory for the format. However, top of page placements, which have always existed for Sponsored Brands, accounted for 88% of spend in Q4.
- Spend for international campaigns targeted outside of the United States grew 45% for Sponsored Products and 39% for Sponsored Brands, as these campaigns continued to outpace US growth.
- Sponsored Display ads were formally announced in September 2019 as a way for Amazon advertisers to access display inventory with minimal setup requirements, and in Q4 2019 the median advertiser deploying these campaigns spent 2% as much on them as Sponsored Products. The DSP currently offers more robust targeting capabilities than Sponsored Display for advertisers looking to invest in Amazon display inventory.
- The holiday shopping days that registered the highest sales per click for Sponsored Products advertisers were Black Friday and Cyber Monday, as both the volume and value of ad traffic soared on these key shopping days.