You can buy just about anything on Amazon.com, including advertising. Now Amazon is selling ads on other people’s sites, too.
The e-commerce giant has started what is effectively an ad network* where it buys Web advertising inventory and resells it to marketers at a premium. It can add a mark-up to its ads because it’s using the data it collects about its visitors and shoppers to target likely prospects.
Amazon has noodled with Web ads in the past, but has confined itself to selling space on Amazon.com and other sites it owns, like IMDB.com. This is the first time it has branched out into ads on third-party sites, and that could be a big deal: It could be a serious revenue stream for the company, and it could also raise a privacy fuss.
The company is moving into the third-party ad business with the help of Triggit, a San Francisco-based ad tech company; there’s a press release announcing the partnership at the end of this post. An Amazon rep declined to comment beyond the announcement.
Here’s how it works: Amazon uses the detailed data it collects on its customers and visitors to create pools of potential marketing targets. Amazon tells Triggit to hunt down particular Web surfers after they’ve left the site, using tracking “cookies;” once the start-up finds them it purchases ad inventory those users are looking at. Amazon uses that ad space to serve up an ad for the marketer it’s working with, and charges them for the impression.
This is another take on “retargeting,” where advertisers trail Web surfers from site to site, and which has become standard issue for Web advertising. Retargeting rankles some privacy advocates, since Web surfers usually aren’t aware that people are tracing their movements.
The targeting is theoretically anonymous, since the marketers aren’t technically tracking individual people but their Web browsers. But that distinction doesn’t mean much to many people.
And since Amazon’s working with much more information — it knows what you looked at on its site, what you bought, and all sorts of other personal information — I can see folks making a fuss about this move, too.
On the other hand, Amazon’s already using personal information to show you stuff you might like to buy on its own site, and via promotional e-mails (“customers who have purchased or rated music by Elvis Costello might like to know that Delivery Man is now available”). So it’s entirely possible most people will shrug this off, if they’re even aware of it.
And if it works, there’s a lot of opportunity for Jeff Bezos and company here. Not only does Amazon have an enormous data set to work with, it can pitch marketers on its ability to “close the loop” between online advertising and commerce — it can get an ad in front of a potential customer, and then show that the customer ended up buying the product on Amazon.
Amazon chooses Triggit’s Demand Side Platform (DSP) technology
San Francisco, Calif. – June 28, 2011 – Triggit today announced that it has been selected by Amazon.com to serve as a Demand Side Platform (DSP) for Amazon’s digital display advertising. Triggit will provide Amazon with its sophisticated real time bidding (RTB) software to enable Amazon to show the right ads to the right users across nine ad exchanges and more than four million websites.
“To be selected to provide technology to a company as technically advanced as Amazon is humbling and incredibly exciting,” said Zachery Coelius, Triggit’s CEO. “We are looking forward to working with the Amazon team to hopefully bring some of the amazing innovation they have brought to ecommerce to the world of advertising”.
Triggit has been at the forefront of recent innovation in the online advertising marketplace and has developed technology that enables companies such as Amazon to better communicate with their audiences with highly relevant and timely messages across the entire web. Over the past year Triggit has seen wide adoption of its technology across the Fortune 500 and now counts as customers a diverse group of companies such as Kodak, Mazda and Orbitz. That market traction also enabled Triggit’s revenues to grow by over 2000% in 2010.
*For AdExchanger readers: Yes, this isn’t technically an ad network. But for general readership, the phrase should work well enough.