In March of 2017, we highlighted that Amazon was “fast becoming an ad platform.”
Just a year and a half later, the tech and retail giant rebranded their advertising business into the intuitively named, Amazon Advertising. The initiative reflects the platform’s rapid growth and maturation from being lumped into the company’s “Other revenue” category last year to being on pace to generate over $8 billion this year.
As radio ambitiously rolls out skills to drive at-home tune-ins, Amazon prepares to launch voice assisted ads on Alexa.
Like Facebook before it, Amazon would likely have hockey stick revenue growth with or without millions of dollars in free promotional inventory from radio encouraging listeners to check out the platform.
However, there appears to be a disconnect between the valuable on-air inventory being given to promote smart speakers and a clear monetization strategy for radio.
In the meantime, Amazon’s advertising strategy continues to accelerate.
Within radio, there’s near universal agreement that spot loads are too high.
Yet we run promotional inventory that highlights another rapidly emerging advertising platform that by 2020 will likely be larger than the entire radio industry, while we struggle to promote our core on-air product that drives over 90% of AM/FM’s revenue.
Adding insult to injury, we’re not reaching digital natives with a smart speaker, streaming message. Instead, we are taking that message directly to our employed, core listeners who seek us out and continue to listen on actual radios, essentially undermining our own self interest.
Perhaps this valuable on-air inventory could be repurposed to reinforce and promote on-air listening, while mixing in an occasional smart speaker promo, using a ratio that reflects the amount of listening that we would reasonably expect the devices to contribute 12 months from now.
Meanwhile, spending time off-air, crafting a compelling value proposition for your employed listeners, which will keep your station top of mind on voice activated devices and in the car along with a corresponding monetization strategy is certainly time well spent.
Worth noting, even a voice activated world without presets is very much a moving target. Take for example the MIT Media Lab, which is already developing technology that can generate search commands based only on what you’re saying to yourself. As Popular Science describes it, “It’s like having Siri listen to your internal commands.”
Until then, we are playing checkers, while Jeff Bezos plays chess.
As evidenced by his recent interview in Forbes, “Friends congratulate me after a quarterly-earnings announcement and say, ‘Good job, great quarter,’ and I’ll say, ‘Thank you, but that quarter was baked three years ago.’ I’m working on a quarter that’ll happen in 2021 right now.”
– Andrew Curran, President and COO