Amazon Is Making Online Shopping Easier For Its Prime Video Users

Amazon is exploring a new way to attain profitability, and this process involves allowing viewers on its Prime Video to shop through their televisions.

Amazon already has a headstart in this new niche as it runs one of the largest ecommerce platforms globally. Besides launching this offering, it also started running ads on the US Prime Video service on January 29.

Amazon Brings Shopping Closer To TV Lovers

Amazon already has the detailed shopping profiles of its Prime Video users. Moreover, it has a working shipping and logistics framework in the US that is capable of delivering millions of products to users based in the US within a day or less.

If Amazon makes this new offering work, it will make shoppable TV happen. Amazon will run video ads on Prime Video, attracting brands that want to make their products accessible to the vast user base. The products featured in the Prime Video ads will be available for purchase on Amazon.

Commercials on Amazon's Prime Video are expected to generate $5 billion for the company this year, but only time will tell if viewers are ready to shop from their televisions https://t.co/F75mQodUm3

- Bloomberg (@business) January 29, 2024

Amazon seeks to secure a massive market share of the streaming advertisement market. Over the years, brands have been allocating more of their marketing budgets towards advertising on streaming platforms compared to traditional TV, and Amazon is not being left behind.

Amazon competes with Netflix to secure a large share of the US market. It is the second-largest streaming platform in the US after Netflix. Launching a lower-priced advertising tier will help Amazon unlock a new audience base. It will also be a boost for its ecommerce platform.

Amazon's Advertising Tier Package

Amazon Prime subscribers can view commercials in movies and TV shows with this advertising tier. However, if users wish not to view ads, they must pay an extra $3.

Unlike Netflix, which introduced a lower-priced tier package, Amazon imposes ads on all users. Opting out of this option will have a user fork out an additional $3 monthly.

However, Amazon offers a juicy ad tier to streaming platforms and subscribers. The streaming platform will provide fewer ads than other streaming platforms and linear television. Moreover, the ad tier will also come with perks such as fast shipping and music.

Amazon estimates the Prime Video ads will hit 115 million viewers in the United States monthly. Given Amazon's broad reach, the company could surpass YouTube by 2025 to become the second-largest TV advertiser in the US after Hulu.

To advertisers, Amazon is also offering a lucrative deal. The company is offering advertising rates that are much lower compared to those provided by Disney+ and Netflix. Moreover, Amazon is not forcing advertisers to make large spending minimums to access the offering. These favorable terms are attracting many brands.

Amazon is making shoppable TV possible with QR codes. The company will feature QR codes during the Thursday Night Football broadcast. The QR codes will appear during the broadcast, and customers can scan them to access products listed on the Amazon online marketplace.

Nevertheless, Amazon faces a hurdle of making customers willing to purchase the products promoted in ads. However, the initiative is already an instant success as Amazon will immediately have all existing Prime Video subscribers on the advertising package unless they make an extra payment.

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