Amazon's Unique Audio Ads Beta Test for Its Freemium Music Service Fails to Impress Major Brands

Earlier this year, Amazon quietly launched an ad-supported tier of its own music streaming platform.

The service remains available to users in the U.S. who have an Alexa-enabled device.

Prior to the surprise launch, Amazon had already reached an agreement with the Big 3 – Warner, Sony, and Universal Music.  Exact details remain unclear, yet the e-commerce giant’s deal likely includes guaranteed per-stream payments.

Unlike on other major players in the music streaming market – Spotify, YouTube, SoundCloud, Pandora, and Deezer – users on compatible devices could stream a very limited catalog on Amazon’s ad-supported service.  The service’s launch may come as a response to the growing number of music-related requests users make on Alexa-enabled device, including demands to play a song, clarify a song title, identify a song based on a lyric snippet, or pull up a playlist.

Now, aiming to grow its ad-supported music service, Amazon had quietly issued a call to major companies.

Want to advertise on Amazon Music?

According to a leaked document shared with reputable outlet AdAge, Amazon has shared a 4-page PowerPoint presentation with advertisers.

The first page reads,

Amazon audio ads – Beta.

Opportunity to test a new audio ad product that will run within exclusive Amazon audio inventory on Alexa.

The e-commerce giant explains the purpose of the beta is to test and “better understand” consumers’ response to a new “audio advertising experience.”

So, what makes this “experience” so unique?  According to the company, advertisers had access to an exclusive “audio inventory” on Alexa.  They also had over 1 million untargeted guaranteed audio impressions.  Amazon provided advertisers with impressions and audio completion rate.  Audio impressions on Alexa-enabled devices with a screen were accompanied with a non-clickable image.

Speaking with the media outlets, an unnamed advertising agency executive said the e-commerce giant had invited Colgate, L’Oreal, and Lululemon, among others, to participate.

Advertisers explained these audio ads provide something Spotify and Pandora can’t – direct product sales.  Alexa users, for example, can quickly shop for and purchase items they hear in ads.  In addition, Amazon Music remains the default music option on devices like the Echo, Echo Dot, and others.

Yet, the beta also had a major drawback.  As the ad-supported service has yet to roll out to wider audiences, major companies could only search through a limited segment of users.  In short, people who used Prime Music or Music Unlimited didn’t hear the ads.

In addition, advertisers couldn’t choose the songs accompanied by the ad.  They also couldn’t target a specific segment of shoppers.  Amazon had given advertisers “short notice” to develop ads for the beta.  Plus, the e-commerce giant also hadn’t prepared to provide companies with “key data” on how the ads actually performed.

The unnamed advertising agency executive said Amazon will have to carefully plan the actual ad program rollout.

The test wasn’t hugely successful.  Amazon hasn’t quite figured out how to insert the ads in a way that makes sense and they haven’t thought out the usability for brands.

Audio ads will reportedly launch in the first fiscal quarter of 2020.  Hopefully, Amazon learns the lessons from the beta test.  Otherwise, expect the e-commerce giant’s upcoming ad program to fail spectacularly.

You can view the PowerPoint presentation in PDF format below.

 


Featured image by Brandon Grasley (CC by 2.0).